'mm: Cornell University Law Library The Moak Collection PURCHASED FOR The School of Law of Cornell University And Presented February 14. 1893 IN HEnORY OP JUDGE DOUQLASS BOARDMAN Fm3T DEAN OF THE SCHOOL By his Wife and Daughter A. M. BOARDMAN and EI-LEN D. WILLIAMS INDEX CASES REPORTED IN THE FIRST PART. A. Albans, St., Bank, re . . page 84 Alexander & Co., ex parte, Hastie & Hutchinson, proof of debt ; account ; set off ._ 59 Allison, re, mortgage ; furtherage ; proof of debt 26 , ex parte Palhbb, renewal of protection . . . . . . . . 68 Ancwttmous, summons to trader debtor ; admission of part of demand ; bond ; prac- tice . . . . . . . . 5 , adjudication upon the petition of a trader debtor ; practice . . . . 6 , district in which petition for adjudication against a trader shall be prosecuted . . . . .7 , jurisdiction to order petition to be amended . . . . 10 , trader debtors ; petition ; as- 15 19 25 42 48 51 , trader debtor's summons ; va- lidity of debt , summons of trader debtor bond tice .-. — , trader debtor ; summons ; prac tection -, trader debtor ; simmions ; pro -, petition ; trading ; sec. 90 -, bankrupt is not to be examined as to his moral conduct ... , accountant's costs ., 59 Anontmous, costs of double sitting page 63 , trader debtor ; summons pend- ing arrangement . . . . . . . . 63 , trader-debtor summons ; act of bsmkruptcy . . . . . . 65 , trader debtor ; summons ; in- dorsement . . . . . . . . . . 66 , trader debtor's summons against partners ; separate admissions '. . .70 , petition under the trader- debtor arrangement sections . . . . 70 , audit ; trade assignee ; costs 117 Abbeb, re, ex parte Lewis & Others, re- moval of an assignee ; costs . . .67 Bowers & Company, removal of fiat . . 18 BuKGHES, ex parte, re Bubghes, breach of trust ; conditional certificate ,. . . 116 C. Carter, expa/rte, in re Carter, books , . 83 Catohpole, re, petition under sec. 211 of Bankrupt Law Consolidation Act . . 74 Cheatham, ex parte Woods & Thomas, proof of debt ; partnership ; practice . . 64 Chibholm & Chisholm, re, double sittings ; costs . . . . . . - . -. 50 , ex parte Dendy &, Others, un- completed contract ; assignees to elect ; whether a conveyance is a deed or an escrow . . . . ^, ,-, .-. 53 INDEX. CowLiSHAW, ex paHe Sutton & Ash, con- current petitions eigainst partners ; prac- tice . . . . . . 47 D. Dale & Peichaed, re, a creditor who has proved a^inst the joint estate is not en- titled to inspect the separate books . . 17 Delafield, re, certificate . . . . . . 123 Dendy & Others, ex parte, re Chisholm, uncompleted contract ; assignees to elect ; whether a conveyance is a deed or an es- crow ; contract to he voided on both sides 63 Disputed Adjudication, m re, a, evidence 77 E. Edwaeds, re, discharge ; practice . . . . 3 Elliott, re, solicitor and client ; privilege 74 Emmings, re, proof of debt ; effect of bank- ruptcy on Statute of Limitations . , 34 FOLKEE, ex parte, Sheward, proof of debt; suppressed document ; secondary evidence 41 6. Geeeing, re Spaekes, right of assignees to retain damages recovered by them in re- spect of an injury done to the bankrupt through the dishonour of his acceptance against the holders of the bills . . . . 51 Good, ex parte Good, breach of trust ; lien ; proof . . 78 Gould, re Shbeman, petition for adjudica- tion by solicitor ; costs . . 32 H. Hakt, re, a. creditor who has assigned his debt may vote in the choice of assignees ; power of attorney to vote on choice ex- tinct when once executed - . . 57 Hastie & Hutchinson, ex parte, Alexan- der & Co., proof of debt ; account ; set off - „ .. 59 Heathooat, ex parte, Mullen, equitable mortgage ; further advances ; fixtures on mortgaged premises 42 Iewin, re, jurisdiction of senior commis- sioner over petition for adjudication . . 27 K. Kellick, re, balance - sheet ; bankrupt's oath ; power of commitment ; penal clau- ses ; protection ; notice . . . . 1 King, ex parte. White, equitable mortgage ; order of sale ; delay by assignees ; further order ; assignees permitted to bid . . 31 Lee, re, construction of Bankrupt Law, sec. 257 118 Lewis & Others, ex parte, Aebee, removal of an assignee ; costs „ . . ,_ 67 M. M'Cleod, re, bankrupt's discharge ; evi- dence . . ,_ _. . . 27 Mullen, re, BfeATHCOAi, equitable mort- gage ; further advances ; fixtiu'es on mort- gaged premises ._ .. ... '..42 MuLLlNS, ex parte, Mullins, disputed adju- dication ; solicitor and client ; privileged communication ... .. ., ^ 11 N. Naiknb, ex parte, Naienb, non-surrender of bankrupt ; application for leave to sur- render refused . . ,_ _ .-37 P. Palmer, ex parte, Allison, renewal of protection .. ... . . _ ^ gg Petit, re, evidence, proof ., ., „ 6 INDEX. Petition for Adjudication, re ; it is not sufficient for a solicitor to sign his own petition in the presence of his clerk . . 28 Pmchaed & Dale, re, a creditor who has proved against the joint estate is not en- titled to inspect the separate books . . 17 Pym, re, practice ; arrangement between debtor and creditor , . . . 8 K. RiOHAKDS, re, lien ; reducing proof ; mis- take 20 RusHBKOOK, re, certificate; assignees may oppose without notice .72 Shekman, ex parte, Gould, petition for ad- judication; solicitor who is petitioning creditor signing his own petition in pre- sence of his clerk ; new petition . . 32 Shewakd, re, Folkeb, proof of debt ; sup- pressed document ; secondary evidence . . 41 Smakt, re, bankrupt's books ; certificate . . 14 Spabeow, re, certificate . . . , 69 Spabkes, re, Geekihg, right of assignees to retain damages recovered by theni in re- spect to an injury done to bankrupt through the dishonour of his acceptance against the holders of the bills . . . . 61 Spottiswoode, tx parte, Eichakds, lien ; reducing proof; mistake . . . . 20 St. Albans Bank, re, certificate . . .84 Sutton' & Ash, ex parte, Cowlishaw, con- current petitions against partners ; prac- tice ..47 Summons aoainst Teadee-debtor, in re a, informality in notice ; practice . .134 T. Thompson, re, equitable mortgage ; order for account and sale . . . . . . . . 29 Thomas & Woods, re, certificate ; assignees may oppose without notice .72 Thomas & Woods, re, Cheatham, proof of debt ; partnership ; practice . . . . 64 Tidmaesh, re, certificate ; notice of opposi- tion . . . . 135 Teacey, re, bankrupt's books ; credibility of accounts . . ... . . . . . . 13 Teadee Debtoe, re, summons ; disputing debt; informality; notice; practice ..134 W. West, re, solicitor ; petitioning creditor ; costs ., . . . . 71 White, re, ex parte King, equitable mort- gage ; order of sale ; delay by assignees ; fiirther order ; assignees permitted to bid 30 WOODEOOFE, re, proof; partnership; contri- bution ._ . . . . 14 Woods & Thomas, re, Cheatham, proof of debt ; partnership ; practice ._ ... 64 , re, certificate ; assignees may oppose without notice - 72 Woolset, re, costs of double sittings . . 50 INDEX or CASES EEPORTED IN THE PRESENT PART. Alcabd, expwi'te, re Milton, registration 217 Anonymous, trader debtor, simmions 162, 227 , petitioning creditor ._. ... 175 , contempt „ „. . . 181 B. BEoroBD, ex parte, jurisdiction ... „ 213 Blaokwbll, re, disputed adjudication . . 155 BotJCHBB, ex parte, injunction . . . . 157 Bypos, re, conditional certificate . . . . 204 C. Cawood, re, ex parte Shaw, contingent debt 159 Clay, re, adjudication . . ... . . 212 Glutton, ex pa/rte, payment on eve of bankruptcy ... ... ... ... 167 Cooper, ea; ^06rtc, jurisdiction .. .. 196 Cross, ex pa/rte, re Pioqott, stoppage in ... .. 215 ... 229 .. 207 D. Dawson, re seamen's wages Dennis, re new assignees ... E. Edwards, ex parte, re Hameb, fixtures . . 208 F. FOWLBB, re trading builder ... .., 201 G. GrREY, expairte, certificate ... . . 177 H. HiGGINSON, jurisdiction ... ... ... 209 J. Jardinb, Ml re, ex pmie Trustees op Daet- PORD Savings Bank, stat. 3 & 4 Wm. 4, ..14 -. .. 137 , ex pa/rte, certificate . . -. 182 M. Milton, re, ex parte Axcard, registration 217 N. Nash and Neale, re, ex parte Glutton, payment on eve of bankruptcy ,.. 167 Nbalb, re, certificate ^, -. .-. 206 NoRTHOWER, certificate „ ... 208 E. Roberts, re, disputed adjudication „ 163 EOBINSON, re, discharge of bankrupt - 205 S. Shaw, expairte, re Cawood, contingent debt 159 T. TiDMARSH, re, adjourned certificate meeting 156 Trustees op Dartpord Savings Bank, ex parte, stat. 3 & 4 Wm. 4, c. 14 ... 137 W. Watson, expairte, re Wy at and Thompson, shifting proof ... ... ... ... 178 Woods, exparte, certificate ... ... 230 Wyat and Thompson, re, ex parte Smith, solvent partner . . . . . . ... I79 ~— , ex pa/rte Watson, shifting proof . . 173 REPORTS OF CASES BANKRUPTCY. %\ (Before Mr. Commissioner Shbpheed.) Be Kellick. 1849. Balance-sheet ; Bankrupt's oath ; Power of Sept. 1'kid. X HE bankrupt came up on his last examination. LinUater, solicitor for the assignees, opposed. The bankrupt was examined at considerable length, for the p^^clavi^es' ■ purpose of making it appear that he had contracted certain Protection ,- Qucere — la a bankrupt com- pelled to make oath as to the statements in his balance- sheet when he comes up for his last exami- nation ? The penal . . clauses in the Lawrence, for the bankrupt. — This question arises upon Bankrupt Law the construction of the 160th and 260th sections of the new i^t'^re'^ro-" Act. The first of these sections directs, among other things, spective when ° the accounts that "the bankrupt shall make oath of the truth of such are passed. balance-sheet and accounts, whenever he shall be duly required „ot compelled by the Court so to do ;" but there is no power given to the ^Jf^^/pfote*" tion on the ground that the bankrupt has comanitted offences under the Act. The bankrupt ought to have notice of an intention to oppose his passing the last exami- nation, when the opposition is in respect of alleged offences under the statute. • C R debts by fraud, and that he had given undue preference to certain creditors. The official assignee reported favourably on the balance- sheet, and there was no objection to the accounts rendered. The question then arose as to whether the Court can compel a bankrupt to swear to the truth of his balance-sheet. Be Kelliok. REPORTS OF CASES 1849. Court to compel the bankrupt to make such oath. The power of commitment is given by the 260th section, which directs that if any bankrupt, or the wife of any bankrupt, shall refase to sign the declaration contained in the Sche- dule W to this Act annexed, &c. (the form of declaration substituted for the bankrupt's oath), it shall be lawful for the Court, by warrant, to commit such bankrupt, &c. in London, to the Queen's prison, there to remain, without bail, until he shall submit himself to be sworn, &c. The former section gives no power of commitment if the bankrupt shall refuse to be sworn, and the latter gives such power only wlien the bankrupt refuses to sign the declaration, so that it becomes a question whether the Court can require him to make such oath until he shall have been committed under the latter section, and have submitted, as there required. There is this difficulty as to the form of the warrant of commitment, that it will direct that the bankrupt shall be kept in custody for refusing to make a declaration, and be detained until he shall submit to be sworn ; the effect of which would be, that the bankrupt would be committed for one thing, and detained until he should do another, which he was not required to do at the time of his committal. I conceive that a warrant so inconsistent with itself would be bad. By the Court. — AU I can do is to continue the old prac- tice, and require the bankrupt to make the declaration. The bankrupt then, by the advice of his solicitor, consented to be sworn. Linhlater, solicitor for the assignees. — I have established by evidence a case of fraud and undue preference against the bankrupt : these are two of the offences named iu the 256th section of the Bankrupt Law Consolidation Act ; under that section the Court, even if disposed to pass the accounts, must refuse protection. IN BANKRUPTCY. Lawrence, for the bankrupt. — This is a meeting solely for the purpose of looking into the accounts. The conduct of the bankrupt will be brought before the Court at the certificate- meeting. No objection has been taken to the balance-sheet, the accounts must pass, and the bankrupt is entitled to pro- tection. These charges now brought against him are now, for the first time, penal in their consequences. The assignees ought to have given such notice as would have enabled us to meet them. We are taken by surprise. The Act must be considered prospective; and the conduct complained of took place before it came iato operation. It can never be con- tended that the legislature intended to create new penal offences ex post facto. 1849. Re Kelliok. Mr. Commissioner Shepherd. — I never can think that this Act was intended to operate ex post facto on the offences created by it. This case is by no means clear. The bankrupt should have the benefit of the doubt ; and, as I see no reason why his accounts should not pass, I will grant him protection till the day of the certificate. I may add, that when it is intended to bring charges with penal consequences against a bankrupt at the last examination, he ought to have notice, so as to en- able him to meet such charges. (Before Mr. Commissioner Gouleden.) Re Edwards. Friday, October l^th. OATLIN, solicitor, applied in this case for the discharge of Discharge ; the debtor out of custody on his petition, proposing a private ^^g Commis- sioner is em- powered to discharge a debtor out of custody on his petition, proposing a private arrange- ment with his creditors, upon his compliance with the provisions of the statute, and upon such terms as the Commissioner shall deem meet. Where the debtor offered to give up 200?. to his creditors, his discharge was ordered on payment of the money. But it being objected that the debtor could not raise that sum immediately, It was ordered, that he should have protection against all but the detaining creditor, but that a discharge would not be granted until the money was deposited, or security given. B 2 Ee Edwards EEPORTS OF CASES 1849. arrangement with his creditors, under the statute, (a) which provides that, on such a petition being filed, the Commissioner may grant protection, the debtor being bound to file a schedule of his estate and efiects with the official assignee ; after which a private meeting of the creditors is to be called, fourteen days' notice thereof being given. The question in this case was, whether a defendant in custody was entitled to his discharge from the suit of the detaining creditor. His HoNOUK, after a long argument, held that the Com- missioners had such a power under certain circumstances. As the debtor in this case oifered to give up 200^. his dis- charge would be granted on his doing so. Gatlin said that could not be done at the moment, as it was money to be advanced to him, that he might make a proposition to his creditors. He did not consider that the debtor could be called upon to give up his property until after he had handed in his schedule ; but if he failed in attending the meeting, or complying with the undertaking he had made, he might be treated in the same manner as though he had been made a bankrupt. His HoNOUE said, that general protection was only to be given when the debtor was at liberty ; but when in custody, the Court had power to affix conditions to the discharge. His Honour, in this case, said he would grant protection against all other parties than the detaining creditor ; and on the schedule being filed, a meeting would be appointed, but no discharge would issue unless the money was deposited or bail given. (a) Bankrupt Law Conaolidation curs, the Bankrupt Law Consolida- Act, 1849, sec. 211 a seq. tion Act, 1849, stat. 12 & 13 Vict. Whenever in the following pages u. 106, is referred to, unless the con- the word " Act " or " Statute " oc- trary is expressed. IN BANKRUPTCY. 1849. Anonymous, (a) Satmday, October Wih. A. TRADER debtor was summoned under the 78th section SummonB to of the Bankrupt Law Consolidation Act, accompanied with AdmLion of ' notice requiring immediate payment of the sum of 70/. The P^^* of de- debtor admitted part of the demand, viz. 51. but made the Practice. W^I1GT*6 tit necessary deposition that he verily believed that he had a good trader debtor, defence, upon merits, to the remaining and larger part of the ^erthe^Tsth" demand against the trader debtor. section of the •nil •! Ill 1 ■^'^^' appears, An action ot a debt against the trader debtor was then and admits part pending for the amount claimed by the summoning creditor. "^ ^^ n^^ner An application was made on behalf of the summoning creditor, required by that the trader debtor should be ordered to enter into the bond at the same required under the 79th section of the Act, and that the th^the^beUeves Court would be pleased to make an order as to the form and defence*on°me- nature of the bond. "ts to the re- 11-1111 1 maining and It was contended, on the other side, that the last-named greater part of section did not make it compulsory upon the Court to order ^.j^g courTwiU such a bond to be entered into, and that this was a case in require him to enter mto a which it might be dispensed with. bond to secure the whole de- maud. Mr. Commissioner Goulburn. — The section is imperative as to the bond ; and, untU proper rules and orders are framed under the new Act, I feel it incumbent on me to adhere to the old practice as far as circumstances will allow. I shall therefore decide in conformity with the orders drawn up by my brother Holroyd, which have hitherto been followed by the Court in cases similar to that now before me. I therefore order that the trader debtor shall, within eight days, enter into a bond with two sureties in the penal sum of 150/., and that he shall give the summoning creditor twenty-four hours' (a) In all cases previous to adju- names of the parties. But see inf. dication, it is our intention, for ob- p. 25. vious reasons, not to publish the BEPOKTS OF CASES 1849. Anonymous. notice of the proposed sureties, if they reside in London, and two clear days, or such further notice as may be necessary, if they reside in the country. Adjudication upon the peti- tion of a trader debtor ; Prac- tice. The Court will require to be satisfied by other evidence than the peti- tioner's affida- vit that he had sufficient assets under the pro- visions of the 89th section. Anonymous. TV TRADER alleged to be subject to the Bankrupt Laws presented a petition to be adjudicated a bankrupt, with an affidaTit annexed, that he had assets sufficient to pay his creditors five shillings in the pound in such form as required by sec. 89 of the Bankrupt Law Consolidation Act. It was contended, on the part of the petitioner, that the affidavit was sufficient to satisfy the Court of the bankrupt's ability to pay five shillings in the pound, and that he should forthwith be declared a bankrupt. Mr. Commissioner Goulbtjrn. — I am clearly of opinion that this affidavit is not sufficient to support an adjudication. I must be satisfied of the facts contained in it by other evidence than the petitioner's own affidavit. I shall hear such evidence as you may be able to produce, in private. Be Petit. Evidence. 1 HIS was a disputed proof The creditor was examined in haTl' right to" support of Ms proof, and was cross-examined by the soHcitor cross-examine a for the assignees. creditor upon mi, i i d t • his proof of Ihe bankrupts sohcitor was proceeding to a further cross- examination, when the solicitor for the proof objected. By the Coitrt.— The bankrupt has a right to cross-examine as to a proof, more particularly as, under the new statute, debts proved under a bankruptcy may have the force of judg- ment debts. IN BANKRUPTCY. 7 1849. (Before Mr. Commissioner EvANS.) Anonymous. Tuesday, October 23rd. A. PETITION was presented, praying that a trader is District in within the meaning of the Bankrupt Law Consolidation Act. foradjnSon It did not appear that such trader had carried on anv against a trader . "^ shall be prose- business for a period of six months preTious to the date of the cuted ; Bank- petition, in any of the districts of the Court of Bankruptcy ; ™udatioI Act but it did appear that he had resided for a longer period ^^- ^^ ^ ^.'^ ' previous to the date of the petition within the London To support a , . . . petition for ad- OlStnct. judication against a trader liable to become Hubbard, solicitor, in support of the petition. — A difficulty bankrupt, it is . not necessary anses on the construction of the 65th, 89th, and 90th sections that such trader of the Act. Sec. 65 declares what shall be a trading, so as ried onbuti^ess to make the person carrying it on liable to become a bank- ?™ ^"^ months , , . . m any district, rupt. But nothing is said as to the period for which such provided he trading shall have been carried on previous to a petition for aided in such adjudication being presented. Sec. 89 enacts that pro- f ual'^eriod" ceedings to obtain adjudication in bankruptcy shall be by petition in the form specified in Schedule M to the Act annexed, &c. The form contained in the schedule is as follows : — " The humble petition showeth, &c. that being a trader, and having resided (or carried on business, as the case may be) for six calendar months immediately pre- ceding the date of this petition," &c. So that the schedule differs from the enacting part of the statute in a matter of form ; where such a variance exists, the enacting part must prevail. {Reg. v. The Magistrates of Harwich, Q.B. Hilary Term, 1849.) The 90th section gives the Senior Commissioner of this Court power, whenever he may deem it expedient, to order any petition to be prosecuted in any district, with or without reference to the district in which the trader shall have resided or carried on business. There is KEPORTS OF CASES 1849. AuoiTTMons. some doubt as to the construction of this part of the Act, but I submit that this is a case in which your Honour will exer- cise the powers vested in you by the last-mentioned section. Mr. Commissioner Evans. — All doubts are cleared up by the words of sec. 90, — " shall have resided or carried on business." The petition may be proceeded with in this court. ( Vide infra. Be Irwin, p: 27.) Practice; Ar- rangement be- tween debtor and creditors. In the case of a petition under the clauses for arrangements between debt- ors and credi- tors, the Court cannot dis- charge the debtor without having pro- duced before it examined co- pies of the judg- ments or re- cords in the ac- tions in respect of which the creditor was de- tained, and an affidavit by the debtor that he had not con- tracted the debt or debts by fraud. (Before Mr. Commissioner Shephbed.) Re John Ptm. JL HIS was a petition under the clauses in the new Act for arrangements between debtors and creditors under the control of the Court. Linhlater appeared as solicitor for the debtor, and Boxhwrgh counsel for one of the detaining creditors. Linhlater, solicitor, applied to have the case taken in private, the sittings contemplated by the Act being private sittings. Mr. Commissioner Shephbbd.t— The present sitting is not within the meaning of the Act ; and the meeting was accord- ingly proceeded with in public. Linhlater then stated that the Commissioner having refused to issue a warrant to have the debtor brought up at this sit- ting, on the ground that the Act conferred no jurisdiction for that purpose, the debtor was not in attendance. Boxhwrgh objected to the hearing of the application in the absence of the debtor ; but Linhlater contended that his presence was unnecessary, and proceeded to call the attention of the Court to the power con- IN BANKKUPTCT. '9 tained in tHe 213tli section of the new Act. The debtor 1849. having duly presented a petition tinder the new Act, the ' Court was empowered to authorise his immediate release, which, he submitted, should be done in this case, unless the detaining creditors showed good cause to the contrary. The Commissioner suggested that the Court could not dis- charge the debtor without having before it the judgments or records in the actions in respect of which the debtor was de- tained, as he could not otherwise be satisfied that the case did come within any of the exceptions mentioned in the proviso at the end of the 211th clause. Linklater. — It woiild be seen that the Court is restrained from ordering the release of a debtor only in cases in which it appears from the judgment or record that the debtor is in prison for a debt contracted by fraud or other means men- tioned in the proviso. ' Now, it was known to every one that a judgment or record in an action for debt did not disclose how the debt was contracted, and therefore, merely looking at the judgment or record, the Court would be wholly ignorant whe- ther or not fraud had been practised in contracting the debt. He contended, therefore, that it was useless to adjourn this case merely for the production of documents the contents of which were already known to be silent on the only subject for which the Court required them. His HoNotJB (having consulted Mr. Commissioner Evans) stated that, as the legislature required it, he must have ex- amined copies of the judgments produced to him; and an affi- davit by the debtor that he ' had not contracted the debts by fraud, before he ordered the debtor's release. Boxhtvrgh applied to have the petition dismissed, and for the costs of his clients; but this application was opposed, and refused by the Commissioner. 10 EEPOETS OF CASES 1849. The debtor therefore remains in prison until the copies of „ , ' the iudaments are obtained, which must be done at his own Se John Ptm. '' " expense. (Before Mr. Commissioner Evans.) Anontmotts. Jurisdiction. -/\.N appHcation was made under the new Act on a petition merates^the"" ^^"^ adjudication (which is now substituted for a fiat) against persons who are a trader who had been in business for four months only. to be deemed traders liable to The soucitor for the petitioning creditor called the attention rupt™butXes "^ ^^^ Court to the 65th clause, by which the persons therein not restrict the enumerated are to be deemed traders liable to become bankrupt, time withm ... . . which they and in which there is no restriction as respects the period of must have re- .i . . i . sided or carried t^^ir Carrying on business. on Se^89^en'acts ^^® ^^^ Section, howoTer, enacts that the petition shall thatthepetition be in the form mentioned in Schedule M, supported by m such case n•^ • -, ' ±sr j shaU be in the aifadavit ; and on reference to the form, it will be found only scMiSe, and *° 3,pply to traders who have resided or carried on business Siclbir^^^ ^to ^°^ ^^^ months immediately preceding the date of the petition, traders who Within the district of the Court in which the petition is pre- carried on busi- sented. In the case before the Court the trader had only been mo^tt^^hin ill business for four months. the district. Queers — Would a case Mr. Oommissioner Evans inquired whether the trader had b°Xrapthad I'esided within the district for six months preceding the carried^™ busi- P®*^*^^'^' ^^"^ ^eing answered in the affirmative, he directed ness be within the petition to be altered by the insertion of that fact, and the 66th sect. ? . i • . « , , But the Court ^^^ omission 01 the statement as to carrying on business. will order the petition to be r^ertfonof the '^^^ sohcitor Said it was important to know whether his fact of residence Honour would have adjudicated in case the bankrupt had not sion of'thr'^ resided or carried on business for the six months within the statement as to district. carrying on business. IN BANKRUPTCY. 11 Anonymous. The Commissioner refused to give any opinion, saying he 1849 should not take upon himself to decide more than he was compelled under the Act. The alteration was accordingly made, without any decision of this important question. Ex parte Mullens, in re Mullens. Thwsday, Nmember \st. A PETITION for adjudication was filed in this court Disputed adju- against Mullens, under which the said Mullens was adjudicated citorLTdciient ■ a bankrupt on the 27th of October last. Privileged com- ■^ .... munication. Mullens now appealed to set aside the adjudication (under A solicitor sec. 104 of the Bankrupt Law Consolidation Act), on the ^^ to rive ground that the evidence of the alleged act of bankruptcy «'"*ience as to t3 ° J^ "^ a cominunica- ought not to have been received, on the following grounds ; tion made by viz. that such evidence consisted of a deposition sworn to by third person in a person who was at that time the solicitor for the appellant aithorgh"°ucli in various actions then pending against him, and which depo- evidence would . .,. establish an act sition contained matter communicated to the deponent m his of bankruptcy character as solicitor for the appellant. The facts appear in ^^^_ the judgment. The evidence was heard in private. Lucas, counsel, in support of the adjudication, cited Bramwell v. Lucas, 2 B. & C. 745. Bagley, counsel, conti^, cited a dictum of Lord Eldon, re- ported in 16 L. J. Chit. Eep. 163; Knights. Turquand, 2 M. & W. 99 ; Pullen's Law of Attorneys, 192, et post. ^^^^, {November 5tk. Mr. Commissioner Evans. — This was an application to judgment. annul a petition in bankruptcy that had issued against the appellant. In support of the application, it was contended that there was no legal evidence of the act of bankruptcy ; 12 EEPORTS OF CASES 1849. and that if the evidence was admissible, it did not prove an act of bankraptcy. The evidence in support of the petition MulSs, was mainly that of Mr. Evans. He stated that he had been Mullens. solicitor to the alleged bankrupt ; that the bankrupt was in- debted to him; that he was much in want of the money, and he called upon him to ask for it on the day of . That on that occasion the bankrupt stated to him that a number of persons were suing him, and handed him several writs, and asked witness whether he could not get him time. The witness stated, in some instances, he thought he could. That as he was going away, the bankrupt told his wife to deny him to any creditor who might call. It was objected that this evidence was inadmissible, as being a privileged communication. In answer to this ob- jection, the case of Bramwell v. Lucas was relied on ; and doubtless if that case could be considered an authority, it would decide the case ; for in that case the communication was made directly to the witness, in the present case it was made to a third party. This difference, as it appears to me, prevents the necessity of my considering whether Bramwell V. Lucas can be supported ; but I think it right to say, that although I might consider the decision erroneous, I should feel myself bound by it until it is expressly overruled by a competent authority. The fact that the communication in this case was not made to the witness, nor in consequence of his advice, does not, in my judgment, permit its being, in point of law, a privileged communication. And this opinion is supported by Greenough v. GasMl, 1 M. & K. 115, where Lord Brougham says : — " But the dictum of law laid down in this case is free from all doubt." It is, that the privilege should be excluded when the communication is not made or received professionally, and in the usual course of business. So in Desborough v. Rawlins, 3 My. & C. 521, Lord Cottenham says: — "But both Bramwell v. Lucas and Greenough v. GasMl show that the privilege applies to cases in which the client makes^ a communication to his solicitor IN BANKRUPTCY. 13 with a view to obtaining Ms legal advice." I am therefore of 1849. opinion that the evidence is admissible. ' Ex parte It was suggested, on the part of the appellant, that the Mullens, general order to deny was not a sufficient a<5t of bankruptcy ; Mullens. but that it is a sufficient act of bankruptcy, there is, I think, no doubt. {Belcher v. Gammon, 9 Q. B. Eep. 874.) It was proposed to call the bankrupt and his wife as witnesses. Previous to the 6 & 7 Vict. c. 85, a bankrupt could not be i called to explain an act which might defeat his commission (Layer v. Garnett, 7 Bli. 103) ; and the Act of Parliament expressly enacts that it should not render competent any party to any suit, action, or proceeding, individually named in the record. I continue of opinion that they were properly rejected. I shall therefore reject the application to annul the adjudication. (Before Mr. Cominissioner Fonblanqxie.) Be Teacey. ,^ , -„ , November m,d. U PON the production of a book purporting to be the ledger Bankrupt's of the bankrupt, bS^f^a^!"' His HoNOUE observed that the account in question, though counts, it purported to have commenced several years ago, was entered subsequently to many others of recent date ; and that there were many blank leaves intervening between the several ac- counts. He could never consider a ledger to be satisfactorily kept, unless the accounts were entered continuously, according to their proper priority, and without any intervening blank leaves There ought also to be a regular index. 14 REPORTS OF CASES 1849. Nmsmber 7th. Be Smart. Mr. commissioner FONBLANQUE.— it is not sufficient that there should be books ; they must be properly kept, and balanced from time to time, so that at any time the real state of the trader's affairs may at once appear. Note. — Mr. Commissioner Fonblanque has had frequent occasion to repeat the above judgments ; but as his opinions on this subject have been expressed almost totidem verbis with the above, we forbear to occupy space with separate reports on the same subject. (Before Mr. Commiaaioner GouLBUKN.) Friday, Be WoODROrFE. November 2nd. Partnership ; i HE bankrupt came up for his last examination. A proof Proof; Admia- tendered by the official assignee of a joint-stock company, sion 01 pay- .^ o •/ ment. entitled the Merchant Traders' Ship, Loan, and Assurance of ajohrtXck Company, for a sum of 1,050/., claimed to be due in respect ^C^^Im^'"^ of certain shares aUotted to the bankrupt, bankrupt, is j^ appeared, from the bankrupt's examination, that he was not entitled to ff > r ' prove for de- a clerk in the above-named company : that, m order to com- bution°aga^st ply with the terms of the Joint-Stock Registration Act, re- the estate of a q^jjig that it should appear on the company's deed that a snarenolder m t. o rr r j the company, certain number of shares had been taken ; and, in order to who has also be- . t l n t i ^ 3 come bankrupt, enable the company to obtam an Act, the directors naa conmanys*deed allotted a number of shares to their officers, and, among others, the deposits are 500 of suchs hares to the bankrupt: that the bankrupt had set lortrii 3iS paid, therepre- accepted such shares, and signed the deed. Upon the produc- company will tion of the deed, it appeared on the face of it that the deposit not be allowed ^^ g^^.jj gj^g^j-gg J^g^^ j^gg^ ^^i^^ to show that ^ such deposits The bankrupt admitted that he had not paid the deposits. were not paid. IN BANKRUPTCY. 15 A further claim was made against the bankrupt for contri- 1849. bution under the bankruptcy of the company. Re WOODEOPFE. Lawrence, solicitor, opposed on behalf of the bankrupt. Mr. Commissioner Goulburn. — This is an attempt by one partner to prove against the estate of his copartner ; for this reason I cannot admit the proof, either as to the deposits or distributive shares claimed by the company. Even if this were not so, I must reject the proof as to the deposits, since it appears on the face of the deed that they were paid. I will not allow the representatives of the company to contra- dict their own admission. Anonymous. A. PETITION for arrangement had been presented by a Trader debtors; trader debtor, under sec. 211 of the Bankrupt Law Consoli- gg^g' "'°' dation Act. An official assignee was appointed, to whom it . Reversionary ° ^ -^ interests and ^ was referred to inquire and state to the Court whether the property a- petitioner had 200/. and upwards ready to be produced, as to be assets was stated in his affidavit in support of the petition (the '^ro^uce"^*'^^. affidavit in the form set forth in the Schedule B). der the pro- rm ■ • ■ IT 1 • 1 Tisions of the The petitioner was m custody under several judgments, trader debtor The assets referred to in such affidavit consisted of a present cUusfs^^the interest in a reversion which would come into possession at Bankrupt Law '■ Consohdation the decease of some persons of advanced age, and of property Act. abroad. The official assignee reported that he had inquired as to the value of the property, and that he was not satisfied that there was 200/, ready to be produced. Catlin, solicitor, for the petitioner, contended that his client might be discharged from custody, and contended that he had fulfilled the conditions required by the statute ; that the 16 REPOETS OF CASES Anonymous. 1849. property was sworn to in the aflB.davit, and thougli not now in possession, was of considerable value, and might be converted into money — the same applied to the property abroad ; that the purchase-money which would be received on such sale would be sufficient to pay 20*. in the pound to the petitioner's creditors. Mr. Commissioner GorLBUEN. — I consider that this statute has given a most valuable privilege to a certain class of traders ; namely, to those who take the opportunity of coming into this court prepared to divide a certain sum at least between their creditors. It is permitted to them to wind up their affairs in this court without incurring the odium of a public bank- ruptcy. I must construe this part of the Act strictly. I should do wrong if I were to extend this boon (given, as it is, by the legislature to traders who have assets immediately available for their creditors) to those who would come here with nothing, or with mere chances of getting something. I am by no means satisfied, in the absence of any evidence as to its value, that I would be justified in considering that property of such uncertain value as reversionary interests would fulfil the conditions of this enactment. It is not suf- ficient that some speculative value is put upon this rever- sion. If it were worth the sum required by the Act, it should have been sold, and the money brought into . court. I am of the same opinion with regard to the property abroad. The petitioner has offered nothing substantial to his cre- ditors. As to the petitioner's affidavit, I must look at it with great doubt. It is too well known that men in diffi- culties will delude themselves into the belief that their af- fairs are in a better state than they really are, and consider almost anything, however remote or uncertain, as available assets. I cannot be governed by any such vague beliefe. I do not consider that the petitioner has at all satisfied me that he has such assets as are required by the Act. I can- not order his discharge. I further consider that he has not IN BANKRUPTCY. 17 complied with the conditions of the Act. I must therefore exercise the authority vested in me by sec. 223, and adjudge him a bankrupt, and adjourn the proceedings into public court. 1849. Anonymous. In the course of the case, the Court offered to release the petitioner, upon the condition of his giving security for the judgments, under the powers given for that purpose in sec. 24. Catlin declined, on the part of his client, to accept these conditions, as it would be impossible for the petitioner to comply with them. (Before Mr. Conmiissioner Fane.) Me Pbichard and Dale. J AMES, counsel, for a creditor who had proved his debts against the joint estate, and who held securities on the estate of Prichard, applied for leave to inspect the separate books of Prichard, with a view to the certificate. A solicitor opposed the application. T-uesday, November 6tJi. A creditor who has proved against thejoint estate is not en- titled to inspect the separate books. Mr. Commissioner Fane. — The general rule in this court is, that all persons who have proved are entitled to inspect the bankrupt's books. Here the application is for a person who has proved against one estate to inspect books relat- ing to the other. The argument is, that these two are con- nected ; therefore, I am not disposed altogether to refuse the application, but I cannot grant it now. The proper course would have been for the creditor to have realised his secu- rities, and to have proved for the residue ; he then would have had a locus standi here. 18 REPORTS OF CASES 1849. (Before Mr. Commissioner Evans.) November 8th. Eemoval of fiat. The Senior Commissioner will order a fiat to be removed to the district in which the bankrupt, the assignee, and the greater number of cre- ditors reside, and the estate is situate. See sec. 90, Bankrupt Law Consolidation Act. Bowers and Company. IHE bankrupt resided and carried on business at Wor- cester. On an application made to the Lord Chancellor (previous to the Bankrupt Law Consolidation Act coming into operation), showing that the greater number of the trade creditors resided in London, his lordship was pleased to order that the fiat should be transferred to, and proceeded with, in the London district. Upon a further examination of the affairs of the bank- rupt, it appeared that the statements laid before the Lord Chancellor were erroneous, and that, in fact, the greater number of creditors resided at Worcester ; it also appeared that the bankrupt still resided at Worcester, as did the sole assignee, and that the estate was also within the same district. Vallance, solicitor, for the assignees, produced an affidavit of the above-mentioned facts, and applied that the commission should be transferred back to the Worcester district. Lawrence, solicitor, for a creditor residing in London, con- sented. Mr. Commissioner Evans. — This is a proper case for the exercise of my jurisdiction. Let the fiat be transferred back to the Worcester district. IN BANKRUPTCY. 19 1849. (Before Mr. Commissioner GonLBDRN.) Anonymous. Saiwday, November lOih. An alleged trader debtor appeared in obedience to the Trader debtor's summons of the Court (under sec. 78 of the Bankrupt Law Bond -"evI- Consolidation Act), and did then deny the demand of the <^™''®- . . The Court will summoning creditor, and made the deposition required by not try the va- the Act (Schedule J), that he had a good defence to such debt^ ° demand. Lucas, counsel, for the alleged debtor. — I propose to tender evidence of the truth of the statements in the deposition, viz. that there was a good defence to the summoning creditor's demand. It is in the discretion of the Court to require a bond to secure the payment of such sum and costs as may be recovered in any action which he brought for the recovery of the demand. It is a necessary incident to this discretion, that the Court has authority to examine into the nature of the alleged defence. If the Court will receive the evidence I propose to tender, it will appear that we have a sufficient defence, and that it is not a case in which the Court wiU require the bond. I propose to call the summoning creditor and the trader debtor. Linhlater, solicitor, contra. Mr. Commissioner Goulbuen. — What you require of me now is, to try whether the demand of the summoning creditor is a good and just demand, or not. If I were to do so, I should usurp the jurisdiction of a Court of Law, and decide by myself a case which ought to go before a jury. I have no jurisdiction to do so. If I were to receive the evidence pro- posed, I should prejudge any case which may be brought before another tribunal, although I could not decide on it c 2 Anonymous. 20 REPORTS OF CASES 1849. myself. I must refuse to receive the evidence. I must also require the hond ; but as the sum to be secured is very con- siderable, and the debtor resides at Norwich, he may reason- ably be expected to find some difficulty in finding the neces- sary sureties at once. I will therefore enlarge the time for entering into such bond seven days. There can be no hard- ship in this, for, should the trader debtor fail to do what I require, he will be adjudged a bankrupt ; but he will then have the right to dispute the demand ; and if he succeeds in so doing, the adjudication against him will be annulled. (Before Mr. Commissioner Shephbed.) N fmh^i2th Ex parte Spottiswoode, re Owen Richards. Lien ; Reducing J. HIS matter came before the Court on the petition of proof; Mistake. , , n , , • i "Wiere a per- Andrew Bpottiswoodo. tir^f^Z^ The petition stated— " The issuing of the fiat, and that ranoe tiiat he WiUiam Banning and others were chosen assignees of the has a lieu for iij Tm i •irr--i such debt, he bankrupt s estate, and Turquand was appointed official as- wUl not he al- lowed, when he SlgUee. mLTalTto'set " '^^^'^ '^^ ^'^^' ^^^^' *^® Petitioner had agreed with the up his lien, and bankrupt to print a work entitled ' Commentaries on the aooordingly.™° ^aws of England,' by George Boyer, D.C.L., barrister-at-law. "That the petitioner, subsequently to the fiat, but pre- vious to the choice of assignees, was informed by the said William Benning that the books or copies of the said work which the petitioner had then in his possession were the pro- perty of the author, and not that of the bankrupt, and that he could claim no lien on them ; and that therefore he proved, on the 1st of February, for the whole amount of his claim against the bankrupt's estate." The proof was made on three bills of exchange for the several sums of 93/. 9s. 3d., 73/. 9s. 9d. and 201/. lis. respectively. IN BANKRUPTCY. 21 It was further stated — " That the petitioner afterwards 1849. amended his proof to the sum of 665^. 18s. and subsequently ' received dividends on his said proofs, amounting, in the whole, Spottiswoodb, to the sum of 155^. 7s. 6d. 0_ EioHABca. " That, subsequently to the receipt of such dividends, the petitioner was informed by the said William Benning that the said books, &c. were not the property of the author, but of the bankrupt ; and an offer having been made for the purchase of the said books, &c. the petitioner, with the know- ledge and consent of the said William Benning, and without prejudice to any question of lien, sold the said books, &c. for the sum of 95Z. " That immediately after such sale, the petitioner sent an account thereof to the official assignee of the bankrupt's estate, beheving that he would be allowed to reduce his said proof ; but, on the contrary, the petitioner was applied to by the official assignee, to deliver up to him aU the books, &c. which the petitioner had in his possession, as being the property of the bankrupt. " That the petitioner refused to comply with such demand, and that an action at law was commenced against him by the assignees for the recovery of the said sum of 95^. in which action notice of trial had been given." The prayer was — " That the petitioner might be allowed to reduce his said proof by the sum of 95/. and that he might be allowed to retain the same in part discharge of his debt — the petitioner offering to refund the dividends to that amount ; and that further proceedings in the said action at law should Ibe stayed, and for the further order of the Court," &;c. The petition was supported by the affidavit of the pe- titioner. The petitioner and the said William Benning were ex- amined mm voce as to the truth of the statement made in the petition. 22 REPORTS OF CASES 1849. There were two dividends, and the sale of the books took place between the first and second dividends. Expa/rte . ii-ii i.-ir Spottiswoode, The work in question was published on the principle of o. EiCTABDs. t^^ profits ; that is, that the author was to use his labour, and the bankrupt to furnish paper and printing. Lucas, va. support of the petition. — This is a petition which, prior to the late Act coming into operation, would have gone before the Vice-Chancellor, to whom matters of bankruptcy were referred. This Court now has jurisdiction to decide this matter. I rely upon the well-established principle of equity, that where parties act in ignorance of their rights and bona fide, the Courts will restore them to such position as they would have been in had they been aware of their rights. There was no contract between the petitioner and the author ; the latter could claim no property ia the books, until the charges for printing, &c. should be paid, according to the cus- tom of the trade ; they were, therefore, the property of the bankrupt, subject to the petitioner's Uen. The petitioner was not aware that he had such a lien at the time he made his proofs ; he was misinformed, and acted in ignorance of his right to the books. The mistake arose in consequence of the information of William Benning, one of the assignees, who ig in the trade, and might be considered by the petitioner as a competent authority. Were it not for this mistake, he would have retained his lien on the books, and proved for the residue of his debt ; and he had an undoubted right to do so. What he now asks is for the Court to restore him to this right, and to allow him to do that which he was entitled to do, and would have done, if he had not been misinformed. The course which the petitioner followed was known to and approved of by Benniag, one of the assignees. He was therefore justified in considering that the assignees concurred with him, and an account of the sale was furnished to the official assignee. It does not appear that all the assignees concurred in bringing the action. IN BANKRUPTCY. 23 Bagley, contra. — The proofs which the Court is now called 1849. upon to amend were made as far back as 1846. The Court Ex parte IS also asked to let in a security which was not stated on either Spottiswoode, of the proofe ; if the security had appeared, the petitioner q riohards. could not then have proved without giving it up, or without an order from the Court above. The petitioner also prays that this Court wiU grant an injunction to restrain an action at law. It is to be doubted whether there is jurisdiction here to do so. The Lord Chancellor would, in urgent cases, grant such an injunction, not by virtue of the bankrupt laws, but under the general equitable jurisdiction vested ia him over matters in bankruptcy. It is stated on the other side, that the petitioner was not aware of the existence of his lien at the time he made the proofs ; but it does not appear that he took any care to ascertain whether he had a Uen or not. He is himself in the trade, and should have known whether the books were the property of the author or of the bankrupt. He treated the bankrupt as his only creditor ; at the time of the bankruptcy, it must have occurred to him to make inquiries as to whether he had any security for his debt or not ; he is satis- fied on that point by the opinion of Mr. Benning, who is not a competent person to give advice in a matter involving a question of law, and who at that time was a stranger to the transactions. The petitioner ought to have taken proper legal advice ; if he had done so, he would have known whether he could retain his lien or not ; but instead of taking the obvious course, he has acted on the advice of Benning, and made his election to prove, which is conclusive against him ; since then he has slumbered on his rights, and now, at a very remote period, asks this Court to give him a remedy for his neglect. It has not been established that the petitioner had a lien on the books ; all that has been urged on that point is, that, according to the custom of the trade, he had such a lien. But the question of lien is to be governed by the legal doc- trines on that head, and not by the notions that persons belonging to any particular trade may have among themselves 24 REPORTS OF CASES 1849. upon the subject. It is a question whether the petitioner ' ' could have sold the books previous to the bankruptcy j but the Spottiswoode, fact of the bankruptcy concludes the question. Under these 0. EicHABDs. circumstances, the books ou^ht to have been delivered to the official assignee. The fact of the sale was unknown to the official assignee till November, 1848. A correspondence then took place between him and the petitioner ; the letters of the petitioner show that he must have been aware whose property the books were. The petitioner offers to refund a portion of the dividends improperly, as he alleges, received by him as a set-off against the sum for which the books were sold. There can be no such question now, as there is no mutuality between the petitioner and the assignees. The assignees have a right' to recover the value of the property so improperly sold. Lucas, in reply. — The fact of the petitioner's lien appears on the balance-sheet. When the petitioner received the se- cond dividend, he was under the impression that it was made on the claim reduced by the amount for which the books were sold. No injury would be done by the Court acceding to the prayer of the petition, as all parties would be remitted to their original rights. In Grtigeon v. Gerrard, 4 Y. & C. 131, Maule, J. declared — " Great anxiety is properly felt by those who administer jurisdiction in bankruptcy against permitting persons who have proved on the footing of holding no security, afterwards to withdraw their proof and set up a security ; " but where, as in this case, the proof has obviously been made in ignorance of the existence of the security, it is highly pro- bable that the Court would give relief Mr. Commissioner Shepherd.— There has certainly been a mistake, the consequences of which must be borne by those who were in error. Petition dismissed, with costs. IN BANKRUPTCY. 25 1849. (Before Mr. CommisBioner Fonblanote.) Anonymous. i.lXTfk. J.N tMs case an action had been brought by the summoning Summons of creditor against the trader debtor. After the summons had Bond. been served upon him, the defendant pleaded to the action, greatermVof and paid the greater part of the plaintiff's demand into the *^^ demand of ■^ . _ ° -^ _ the summonmg court in which the action had been brought. The defendant creditor has had changed the venue in such action into the county where court ^and 'the all the parties reside, and where the cause of action arose. balance is not ^ ' m danger, the It was contended, on behalf of the summoning creditor, Court will not that the Act requires the Court to compel the trader debtor bond, to enter into the bond to secure the balance and costs ; and that if the Court had a discretion as to the bond, the fact of the venue being changed was vexatious, and, for the purpose of delaying the plaintiff, would be a sufficient cause for the Court to exercise such discretion, and to require the bond. Mr. Commissioner Fonblanque. — It is clear that the Act gives me a discretion according to the merits of the case. In this case, unless special circumstances be shown to the con- trary, I do not think I ought to require the bond. The greater part of the demand having been paid into court, is a guarantee for the good faith of the defendant in the action ; and I cannot consider the change of the venue vexatious. The question of the bond may stand over till Friday next, when, if it shall be shown to me on sufficient evidence that the balance is in danger, I will order the bond to be entered into. The solicitor for the summoning creditor came up, and con- Friday, sented to dispense with the bond. '^'"'**''' ^^'^- 26 EEPORTS OF CASES 1849. (Before Mr. CommiBsioner HOLROTD.) N^e^™ce j^g prepared, the petition of a stranger against the same bank- New petition, nipt was filed. Foohs, counsel, for Shearman, the original petitioning cre- ditor, and in support of the first petition. — Eefer to sec. 89 of the Bankrupt Law Consolidation Act, and the form of the petition in Schedule M. The form of the petition must be taken to mean that part which ends with the words " Your petitioner shall ever pray." The attestation clause forms no part of the petition ; no attestation is referred to by the sta- tute. The form of the petition is on the same footing as that of a deed, of which the attestation forms no part. Assuming that the attestation clause is to be considered as a part of the form, then it must be taken to be a matter not of substance, and the statute should be held to be directory, and not com- pulsory, in this respect. {The King v. The Inhabitants of Birmingliam, 8 B. & Cr. 29 ; Dwa. on Stats. 611.) This statute is remedial, and, as to all matters not of essence, should be considered directory, and not compulsory. (Dwa. IN BANKRUPTCY. 83 on Stats. 632.) The attestation in this case is not necessary ; 1849. the Court might dispense with it altogether, in analogy to the ~ ' construction put upon the stat. 1 & 2 Vict. c. 110, which re- Shbakman, quires the attestation of an attorney to warrants of attorney. godld. {Downes v. Gabhett, 12 L.J. N.S. Q.B. 269, and Chipp v. Harris, 5 M. & W. 269.) And again, in Portland v. Bow, 1 Dow. N.S. 183, it was held that it is not necessary to explain the nature of a declaration in ejectment where the person on whom it is served is an attorney. Though the orders of the Court of Chancery required that , petitions in bankruptcy should be attested by an attorney, it has been held, that where it appeared on the face of the peti- tion that the petitioner was an attorney, the rule did not apply. Here, though that fact does not so appear, it appears on the attestation ; but put the attestation out of the question as forming no part of the petition, the petitioner is here to be examined, and the Court will take notice that he is an attorney. As to the restraint that an attorney may exercise over a petitioning creditor, it is not necessary in this case, as the Court will exercise its authority over its own ofiB.cer. Mr. Commissioner Holroyd. — I agree with the arguments of the learned counsel, but I come to an entirely different conclusion. The attestation to petitions for adjudication is no part of the form of the petition, and the Act is so far directory. The question for me to decide is, whether I ought to require an attestation in the words pointed out, or not : it would be going too far to say they do not belong to the Act In Ex parte Steel, 16 Ves. it was held to be inexpedient that the petitioning creditor should be sohcitor to the fiat ; and in Ex parte Badcock the same opinion was expressed as to an assignee being solicitor to the fiat. I am now to con- sider whether, in the exercise of my discretion, I ought to depart from the letter of the Act to permit that which the Courts have held to be inexpedient. I think not. When 34 BEPOKTS OF OASES 1849. Ex parte Shearman, re GOTJLD. this case came before me on a former occasion, I expressed my opinion that the cases relating to warrants of attorney do not apply to the present case. I cannot overlook the fact that it does not appear on the face of the petition that the petitioner is an attorney. I must reject the petition. Before Shearman could prepare the depositions in support of his second petition, a petition against the same bankrupt had been filed by another person. The question arose as to whether Shearman's petition or that of the stranger should be proceeded with. Mr. Commissioner Holeoyd. — Shearman was first in court; his first petition is rejected for informality ; his other petition is in the nature of an amendment of his first. It must have priority over the petition of the stranger, and be proceeded with. (Before Mr. Commissioner HOLROTD.) Re H. Emmings. X HIS was an application by a creditor, whose debt was set forth in the schedule filed in the Insolvent Court, to be allowed to prove his debt ; it was objected that the debt was barred by the Statute of Limitations. Mr. Commissioner Holrotd. — My judgment in ^irj»a?-fo Robinson, in the matter of Lyon, applies exactly in the present case. It was as follows : — In this case {Re Lyon) the bankrupt took the benefit of the Insolvent Debtors Act in the year 1836, and filed his schedule in the Insolvent Debtors Court in the month of April in that year. The schedule contained (amongst other things) the debt of Kobin- HUL years old. Held, that the Statute of Limitations did not operate against it. Six years afterwards, previous to the fiat, the bankrupt filed his schedule in the Insolvent JJebtors Court, and afterwards obtained his disoharge. Thwrsday, November 29th. Proof of debt ; Efiect of bank- ruptcy on the Statute of Limitations, A debt set forth in the schedule of a person who has obtained his discharge in the Insolvent Court, and afterwards be- come bank- rupt, may be proved under the fiat. The schedule was more than six IN BANKRUFTCT. 35 son. In July, 1842, a fiat issued against Lyon, under which 1849. he was declared a bankrupt, and Robinson now seeks to prove ~r under the bankruptcy for the debt which was set forth in the H. Emmikgs. bankrupt's schedule under his insolvency. The Court enter- tained no doubt that a creditor of an insolvent tradei; who had been discharged under the Insolvent Debtors Act, and subsequently became bankrupt, might prove his debt under the fiat in bankruptcy, although it was included in the insol- vent's schedule under his insolvency. This was fully estab- lished in Tellis v. Mountford, 4 B. & A. 256 ; JEx parte Fenwick,' 2 M. & A. 681 ; and Ex parte Barrington, 1 Deac. 3. The ground of the decision in those cases was, that the Insolvent Act did not extinguish the debt ; that, notwithstanding the discharge of the insolvent, by the whole language of the statute, the debt was intended to exist and continue still a legal debt until satisfaction by payment. It was argued that it would be very hard to admit the proof of such a debt as against the new creditors, and, at all events, they ought to be preferred in the payment of their debts to the creditors under the insolvency. But although a Court of Equity, upon a bill filed, has power to marshal assets amongst dififerent classes of creditors, this could not be done upon petition in bankruptcy. This Court must foUow the distribution provided by the bankrupt laws, which is, that the bankrupt's estate shall be divided amongst all the cre- ditors who have proved under the fiat, in proportion to their respective debts. All are to share pari passu ; the joint estate going to pay the joint debts, and the separate estate the separate debts, carrying over any surplus (as the case may be). As to dividing the property amongst subsequent creditors, it would be very difficult to say who are specific creditors of particular property, so as to give a right for claims exclu- sively to attach upon it. The main point, however, for the Court to determine in the present case, is whether, more than six years having elapsed since the schedule was filed in the D 2 36 REPORTS OF OASES 1849. Insolvent Debtors Court, the proof of such debt under the bankruptcy is now barred hj the Statute of Limitations. H. Emings. Now upon this point it may he premised that the Statute of Limitations, in cases where it is applicable, bars the re- medy, and not the debt ; but there are different classes of cases in which it has been held that the Statute of Limitations does not run ; as, where a fiat has issued, the proof of a debt not barred by the statute at the time of the issuing of the fiat will not be barred by any lapse of time afterwards, the fiat being considered in the nature of a trust ; and in cases of trust, the statute does not run. (Ex parte Boss, 2 Gl. & J. 46 & 330.) So, if a man by will charge his real or personal estate for payment of his debts, or make a devise or bequest for payment of all his debts in equity, the statute is thereby prevented from running agaiust any debts not barred in the lifetime of the testator (Jones v. Scott, 1 Russ. & M. 255) j and in Trueman v. Fentmi, Cowp. 548, Lord Mansfield said, a Court of law, in a case properly brought before them, would say the same, on the principle of giving effect to that intention. So a liability arising in respect of a lien is not barred by the Statute of Limitations ; and upon a bill filed for the administration of a deceased insolvent's assets,. the right to reUef in a court of equity is not affected by the Statute of Limitations, the debts in the schedule of the insol- vent being considered as liabilities in respect of a lien created by statute. (Barton v. Tattershall, 1 Euss. & M. 237.) In the case now before the Court, it was like establishing a trust by the debtor, the effect of which is to convert the creditor into a cestui que trust, and therefore it is not competent for the assignees under the bankruptcy, who represent the debtor in the administration of his assets, to take advantage of the Statute of Limitations, when the debtor, by creating the trust in the Insolvent Debtors Court, had in effect declared that the Statute of Limitations should not operate. It is perfectly clear that the property now administering under the bank- ruptcy would have been applicable to the payment of this IN BANKRUPTCY. debt, amongst others, if administered in the Insolvent Debtors Conrt, which it would have been but for the bankruptcy ; and although it was enacted by the Insolvent Act (7 Geo. 4, c. 57), under which the bankrupt obtained his discharge, that if at any time after the assignment by the prisoner he shall obtain his certificate in bankruptcy, the power of the assignees in the Insolvent Debtors Court over any property remaining to the prisoner after obtaining his certificate shall be the same as if the assignment had been valid ; still the title of the assignees under the bankruptcy is preserved, as well as the full benefit of the certificate to the insolvent. It would therefore be hard upon the creditor, if the law compelled his proof to be rejected under the bankruptcy. The proof was admitted. The proof m case must be admitted for the same reasons. (See Uw parte Garnett, 1 De Gex, 95.) y7 1849. Re H. Emmings. (Before Mr. Commissioner Fonblanqde.) Ex parte Nairne, re Nairne. Friday, December \ith. 1 HIS was the petition of Edward Nairne, the bankrupt, ^ b^X^"^!"" for leave to surrender, he having failed to do so at the time Application for prescribed for that purpose. The circumstances of the case render refused were a. follows:- ^^^^^^; In July last the bankrupt left his usual place of business, absconded pre- ^ vious to the and went to Boulogne, as was alleged, for the purpose of adjudication, avoiding criminal proceedings against him. A few days after, surrende?°at a fiat in bankruptcy issued, under which he was adiudicated *^? *™®/P" . ■^ ■' ' •' pointed for his a bankrupt, and a day was appointed for him to surrender, on last examina- which day he did not appear ; a warrant issued for his ap- proceedings prehension, and an order was subsequently obtained, by which "^e^cli^ssinat him for the non-snrrender, and a warrant having been issued against him, he was taken in France by virtue of the convention between the two kingdoms for the surrender of certain offenders ; he was then taken before a magistrate, and after several examinations, was committed for trial. The bankrupt alleged that he absconded from causes foreign to the bankruptcy. The Court refiised to allow the surrender. re Naibne. 38 EEPORTS OF CASES 1849. the assignees were directed to commence criminal proceedings for the non-siirrender. The bankrupt was taken abroad by m^t "^^iie of such warrant, and now came up in custody, after he had been committed by a magistrate on the criminal charge. Lawrence, solicitor, for the bankrupt. — It would be for the benefit of the creditors to allow the bankrupt to surrender. The Courts have allowed bankrupts a locus pmnitentice in such cases. {Ex parte Berryman, 1 Gl. & J. 223 ; Ex parte s, 2 Rose, 381.) Hilleary, solicitor, contra. — Criminal proceedings have been commenced against the bankrupt for the non-surrender, and he has been committed for trial. It is as if a true bill had been found against him ; in that cage the Court would not take the surrender. {Ex parte Levi, 2 Mont. & Ayr. 685.) Lawrence, in reply. Mr. Commissioner Fonblanqtje. — The Legislature has always considered the non-surrender of a bankrupt as a very grave offence — so grave, indeed, as formerly to merit punish- ment of death. This extreme severity of the law has been from time to time relaxed, and now the punishment is reduced to transportation for seven years ; for experience has shown that extreme penalties stand in the way of and prevent pro- secutions ; but the object of this relaxation of the law would be defeated if, notwithstanding the reduction of the punish- ment, the Courts should interpose difficulties in the way of prosecutions. The early rule under which the Cotirts would allow the bankrupt to surrender, after the proper day had passed, is laid down in Ex parte Higginson, 12 Ves. 496. There the Lord Chancellor said, " If by an innocent default of the bankrupt he has neglected to surrender himself on the day appointed, the Lord Chancellor may, upon petition, IN BANKUUPTCY. 89 make an order that the Commissioners be at liberty to 1849. appoint a new day for taking the examination." And again, ' ' " But such order giving a bankrupt leave to surrender after Nairm,. the time prescribed by Act of Parliament is not mandatory Naiene. upon him, and gives him no protection except so far as it may show the favourable inclination of the Lord Chancellor, and by not surrendering he does not incur a contempt ; such order, however, would not protect him from a prosecution.'' {Ex parte Johnson, 14 Ves. 40 ; Ex parte Jackson, 15 Ves. 19.) Subsequent cases have gone on these principles — phy- sical impediments, misadvice, and misconception, were con- sidered as mitigatory circumstances, under which favour would be shown to the bankrupt. At first the cases went to this, that the order to allow the surrender was never made when the assignees opposed. This rule was first broken into in Ex parte Shiles ; but the report of that case is very short, and no reason has been assigned for the decision ; so that I am at a loss to know how far I am to consider that case as an au- thority. The order has since then been very easily obtained. I cannot tell why ; for I shall consider that in proportion to the diminution of the punishment, and the increased facihties for committing the offence of absconding, the dispensing power should be more rarely exercised. But it was always discre- tionary in the Commissioners to receive the surrender or not, on account of their greater knowledge of the facts. In this Court, on a former occasion, where a bankrupt had absconded and taken away money, and remained away a considerable time, I refused to receive the surrender, notwithstanding the order of the Court of Review giving me liberty to do so. Now, looking at this case, it does not appear, from what has been shown on the bankrupt's behalf, that there are any circum- stances to entitle him to the favourable consideration of the Court. Could a man in the same position of life as the bank- rupt (a stockbroker) have been ignorant of the consequences which would of necessity follow his absconding? I cannot think so. He must have known, when he left his place of 40 EEPORTS OF CASES 1849. Xx parte Naikne, re Nairne. business and went abroad, that he committed an act of bank- ruptcy, and that a fiat would follow. I must therefore con- sider the act of bankruptcy as wilful ; and I am of the same opinion as to the non-surrender ; and there is this additional reason to lead me to that conclusion ; namely, that there is nothing to show that the bankrupt would ever have willingly surrendered. It must be borne in mind that he is here in custody on the criminal oflFence, and that a prosecution has actually been commenced. And I know of no case where the Courts have interposed favourably to a bankrupt under such circumstances. As to the excuse of ill-health, there is no evidence of that. Such a statement should be borne out by some testimony, at least that of a medical certificate ; and even then it ought to be made to appear that the illness was of an exceedingly grave character. On a careful review of the case, I can see no reason for indulgence. If the prosecution were malicious, there would be a legal mode of preventing its success, by impounding the proceedings, as in former cases the Lord Chancellors have said they would. do where they were of opinion that they could have recommended a pardon. This is not a case of accident, ignorance, misadvice, or unavoidable misfortune, or of any circumstance under which, as I believe, the Lord Chancellor would advise a pardon. I must, there- fore, dismiss the petition. Notice of motion, by way of appeal, before the Vice-Chan- cellor acting in bankruptcy, has been served on the proper parties, and the Court has made an order as of course for the messenger to attend that court with the proceedings on the day of hearing. IN BANKRUPTCY. 41 1849. Ex parte Folker, re Sheward. -i^^^T^Ti'i IjTJCAS (counsel) tendered a proof of debt for 1,284^. and Proof of debt; ,■■11 Suppressed asked leave to increase the proof to 1,840^. by giving verbal document; evidence of the contents of a written document under the fol- ^l^_ ^ *^'' lowing circumstances : — The person seeking to prove, a Mrs. Folker, had for some years been in the habit of advancing sums of money to the bankrupt, and the bankrupt always wrote the sums lent in a book, which was kept by Mrs. Folker, she being unable to read or write more than her own name. It had been proved on a former occasion that Mrs^ Folker having shown the book to a neighbour of the name of Robertson, he told her the account was not rightly headed, and she thereupon gave him the book to take to the bankrupt to be altered ; that the bankrupt had kept the book, and, under the pretence of having lost it, refused ever after to produce it. Lucas (counsel for Mrs. Folker) applied that the evidence of Robertson as to the contents of the book, and that of Mrs. Folker, to whom Robertson had read the total amount therein contained, might be received as evidence of the sums lent by Mrs. Folker to the bankrupt, so far as regarded the differ- ence between 1,840/. and 1,284/. Mrs. Folker having cheques to vouch the latter amount. He cited Moe dem. Haldane v. Hartley, 4 Burr. 2584 ; Annesley v. Earl of Anglesey, ] 7 Howell St. Tr. 1430 ; Armory v. Delamcerie, 1 Str. 504 ; Climes v. Pezzey, 1 Camp. 8 ; Mortimer v. Gradwich, 7 Jut. 45 ; and Hay don v. Haywa/rd, 1 Camp. 180. Mr. Commissioner Fonblanque. — Let the proof stand at present for 1,284/. with liberty to augment it, and to produce secondary evidence of the entries contained in the missing book in support of the augmented proof. 42 BEPORTS OF CASES 1849. Thwsday, December 20tk. Trader debtor ; Summona ; Practice. (Before Mr. Commissioner Evans.) Anonymous. In this case Lawrence, solicitor for the summoned creditor, objected that the summons was irregular, and ought to be dismissed, inasmuch that it was not in form required by the new Act, sec. 78, and Sched. G. The heading " Bankrupt Law Consolidation Act, 1849," was omitted. Willes, contra. The Court held that the summons was bad. There is a form for such summonses set forth in the statute, which ought to have been followed. The summons was dismissed. December Qili. Equitable mortgage ; Further ad- vances ; Fix- tures on mort- gaged pre- mises. Held, that an equitable mortgage may be held by the mortga- gee as security for subsequent advances by way of loan. Tenant's fix- tures pass to mortgagee. Special order. Ex parte Heathcoat, re Mullen. 1 HE petition stated that in the month of August, 1841, the petitioner and his partner Brewin advanced, by way of loan to the bankrupt, the sum of 1 ,000^. for five years, at 51. per cent, on the security of a promissory note for the sum of 1,000^. and interest, dated the 1st day of September, and payable on demand to John Heathcoat (the petitioner) and Co. ; and the several securities set forth in the following letter addressed to the petitioner's agent : — " Sir, — John Heathcoat, Esq., having advanced me one thousand pounds, on loan, for five years, at five per cent, interest, I herewith deposit in your hands, as security for the repayment of the money, the lease of my house. No. 11, Ironmonger-lane, and also a policy of assurance on my life IN BANKRUPTCY. 43 for one thousand pounds in the Westminster Insurance 1849. Office ; the interest of the money to be paid quarterly. ' " I am, Su", &c. Heathooat, " J. Mullen " (the BanTirupt). Mullen. In November, 1843, the petitioner and his partner lent to the bankrupt further sums, amounting to 500^. at five per cent, on the securities which are set forth in the fol- lowing letter, addressed to the petitioner: — " Dear Sir, — I hereby acknowledge to have received five hundred pounds from you on loan, at interest of 51. per cent. ; as a security for which I deposit in your hands my own promissory note on demand, a policy for 500^. on my own life, and the lease of my house and land at Woodford. " I remain, &c. &c. " J. Mullen." " Nov. 29, 1843." This lease has been disposed of, and the petitioner or his partner claims no interest thereon. In June, 1847, a fur- ther advance by way of loan was made by the petitioner and partner to the bankrupt of 600^. on the security of a banker's cheque. Notice was given to the several insurance companies of the deposit of the several policies respectively.. In the following July the bankrupt deposited with the peti- tioner and his partner, as a further security for the several advances and interest, two fire insurance policies on the premises in Ironmonger-lane, which have since been dropped. The joint affidavit of the petitioner and his agent states, amongst other things, that they verily believe, before the time of making the last deposit, it had been agreed between the bankrupt and the petitioner and his partner, that the lease of the house in Ironmonger-lane and the policies should be held by the petitioner and his partner as security for the whole of the advances and interest. The whole of the re Mullen. 44 BEPORTS OF CASES 1849. advances are unpaid, and no interest thereon has been paid since December, 1846. The petitioners have paid the se- H^THcoAT, veral sums of 32/. 5s., 32/. 6s. and ^U. for continuing the said pohcies. The bankrupt, in August last, without the consent of the petitioner or his partner, procured a new lease of the premises in Ironmonger-lane, in substitution of the lease deposited with the petitioner. Notice of motion, to the effect following, was served on the assignees : — Take notice, that the Court will be moved on Tuesday, the 4th of December, &c. on behalf of the petitioner and his partner, claiming to be equitable mortgagees of the bankrupt's lease of the premises in Ironmonger-lane, and of the tenant's fixtures therein, and of a policy of assurance for 1,000/. on the life of the bankrupt, and of another policy for 500/. on the life of the bankrupt, to the intent that the petitioner and his partner might be declared to be equitable mortgagees of the lease, fixtures, and policies, and that their accounts might be taken, and that the assignees might be directed to take up a new lease of the premises in Ironmonger- lane, and that the same might be deposited with the petitioner and his partner in place of the old lease, and that the peti- tioner and his partner might be declared to have the same rights, &c. in respect of the new lease as they had in the old lease ; and that such lease, fixtures, and policies might be sold, and the moneys to arise from such sale be applied in the usual manner. Liicas, counsel, for the petitioner. — The equitable mortgage of the lease and fixtures may be extended by parol to cover the further advances. {Ex parte Withead, 19 Ves. 260 — 479; Ex parte Langton,\1Y%s.1'2,7 ; Ex parte Kensington, 2 Ves. & B. 79 ; Ex parte Lloyd, 1 Glynn & Y. 389 ; Ex parte Nettleship, 2 Mon. Deac. & De G. 124.) We are also entitled to the fixtures. {Ex parte Broadmood, Mon. Deac. & De G. ; Ex parte Cotton, 2 Mon. Deac. & De G. ; Ex parte Reynolds, Mon. Deac. & De G.) IN BANKRUPTCY. 45 Bagley, counsel, for the assignees. — We admit all the facts, 1849. and do not dispute that the further advances are covered by „ " ^ _ ■' Ex parte the equitable mortgages. The only question is, who are Hbathooat,, entitled to the fixtures ? Mhilen. Mr. Commissioner Evans. — The cases under which trade fixtures do not pass apply only to questions between landlord and tenant. As between mortgagee and mortgagor, all the fixtures pass. The question is, what are fixtures? There must be evidence as to that. {Ex parte Fortescue, re Mackie, 1 De Gex, 531.) December Wth. The Court doth order that John Heathcoat and Am- Order, brose Brewin are equitable trustees of the leasehold premises and fixtures comprised in the leases of the 24th June, 1841,. and the 24th August, 1849, and of the policies of insurance effected with the Westminster and General Life Assurance Association and the National Provident Institution, and that the said John Heathcoat and Ambrose Brewin should be at liberty to exchange the said lease of the 24th June, 1841, for the new lease dated 24th August, 1849, and to pay the costs of preparing such lease ; and that the said John Heathcoat and Ambrose Brewin shall thereupon have and be entitled to the same rights and remedies in respect of such new lease as they had in respect of such original lease ; and I find that there is justly due and owing to them, the said John Heath- coat and Ambrose Brewin, the sum of 2,461/. 10s. lOd. for principal money lent and advanced by them to the said bank- rupt and insolvent thereon up to the 27th of October last, secured by the deposit of the said lease of 24th of June, 1841, and the said policies of assurance as aforesaid ; and I order that the said leasehold premises and fixtures and the said policies of assurance be sold by public auction, at the Auction Mart, in the City of London, under the direction of the as- 46 EEPORTS OF CASES 1849. Ex parte Hbathcoat, re Mullen. signees, on the 8th day of January, 1850, and that notice of such sale be advertised in the Gazette, and in the Times; Morning Chronicle, and Morning Advertiser newspapers; and that the said John Heathcoat and Ambrose Brewin, or one of them, by themselves or himself, or by their or his agents or agent, be at liberty to bid at such sale for the pur- chase of the said leasehold premises and fixtures, or any part thereof; and that the said assignees of the said bankrupt's estate, and the said John Heathcoat and Ambrose Breivin, shall join in and concur in the conveyance or assignment of the said lease and premises and fixtures, and the said policies, to the purchaser or purchasers thereof ; and that the moneys to arise from such sale be applied in the usual manner ; that is to say, first in discharge of the costs and expenses of and incidental to such sale, to be taxed by the Master of the Court, and of the conveyance and assignment as aforesaid, and next in discharge, or towards payment of the said debt and interest so due to the said John Heathcoat and Ambrose Brewin as aforesaid ; and that the surplus, if any, of the said moneys to arise as aforesaid be paid over to the official assignee of the said bankrupt ; but if the said moneys so to arise from such sale (subject as aforesaid) shall be insufficient to pay the said John Heathcoat and Ambrose Brewin the amount of their said debt and interest so due to them, it is further ordered, that the said John Heathcoat and Ambrose Brewin be at liberty to go in under the said petition and prove for the de- ficiency, and receive a dividend or dividends thereon, and rate- ably and in equal proportions with the other creditors of the same bankrupts seeking relief imder the said petition. IN BANKRUPTCY. 47 .1849. (Before Mr. Commissioner Fonblanque — sitting for the Senior Commissioner.) Ex parte Sutton and Ash, re John Cowlishaw and James Cowlishaw. Decmriber 5th. X HIS was a petition for impounding a petition and sepa- Practice ; rate adjudication of bankruptcy against John Cowlishaw, Conso™dation^ who carried on business in copartnership with James Cowli- ^'^^'f^"-^^.' ^ ^ Jretition to im- shaw, under which Bittleston was appointed official assignee ; pound separate -I ^ !• ■ T 1 • ■ ^ 1 ■ fiMSj and adju- and also for impounding a subsequent petition by the peti- dacations tioner, under which the said James Cowlishaw was adjudi- nfr^^Petition cated a bankrupt, which petition has not been proceeded for joint adjudi- '■ ^ _ ... cation ; 1 orm with. Subsequent to the last-mentioned adjudication, the of order; Sepa- petitioners presented a further petition, praying a joint ad- tion against judication against the said John Cowlishaw and James Cow- P^'^^^^™ ^' lishaw, under which they were jointly adjudicated bankrupts, spectively ; mi ■ ■ T 1 • • 1 • 1 • Costs. The petitioners are creditors to the joint estate, which is of considerable value, and the separate estate is of small value. The petition prayed that the separate petitions and adjudications might be impounded, and the costs paid out of the joint estate ; and that all farther proceedings under such petitions might be stayed ; that if the official assignee should have possessed himself of any of the assets of the said John Cowlishaw, he might be directed by the Court to act for the same under the joint adjudication. Ayrton, for the petitioners. R. Sargent, for the petitioning creditor, for the separate adjudication against John Cowlishaw, and for the official assignees under the same. His Honour was pleased to make the following order : — Let the petition for a separate adjudication against John 48 REPORTS OF OASES 1849. Cowlishaw, and the proceedings thereunder, and the petition for a separate adjudication against James Cowlishaw, be im- SuTTONr Ash, pounded ; and the costs for the separate adjudication against John ^^^ Said John Cowlishaw, and of prosecuting, making, work- C0WLISHAW& ijjg^ a,ji^ impounding the same, and the proceedings there- CowLisHAw. under, be paid out of the separate estate of the said John CowUshaw ; and if such separate estate shaU prove deficient, then that the same costs be paid out of the joint estate ; and let the costs of the said petition for separate adjudica- tion, and the costs, &c. &c. be paid out of the separate estate of the same James Cowlishaw ; and if such separate estate shall prove deficient, then that the same costs be paid out of the joint estate ; and that the costs of this applica- tion be paid out of the joint estate ; and let it be referred to the proper officer to tax all such costs, as between soli- citor and cUent ; and let the said petitions for separate ad- judications and proceedings be forthwith brought into and deposited in the office of the chief registrar of this court, riot to be produced without the order of this Court ; and let all further proceedings, and the same petitions, or either of them, be forthwith stayed ; and if the official assignee under the said separate adjudication has possessed himself of any moneys and efiects of the said John Cowlishaw under the same adjudication, let him account for the same before the Court, under the joint adjudication against John Cow- lishaw and James Cowlishaw. 1850. (Before Mr. Commissioner Fane.) Friday, , February 15th. ANONYMOUS. Trader debtor; A TRADER DEBTOR summons had issued against A.B. ; S^A^qSt ar- aftcrwards, and subsequent to the summons having been duly rangement ; Protection from process ; Costs. A trader debtor summons is avoided by a protection granted imder the trader debtor ar- rangement sections. But in such ease he must pay all the costs prior to the time when notice of his petition and meeting was served on the creditors. IN BANKRUPTCY. 49 Anonymous. served on him, A. B. filed a petition under the trader-debtor 1850. arrangement sections, and obtained protection till 26th inst., the day of the first meeting ; on this day cause was shown against the summons. Lucas, counsel, for A. B. — We are protected by sec. 211 from all process against person and property. The summons is a process, or, at all events, initiative of, and might lead to process being issued against the person or property of A. B. and as such cannot now be sustained. Lanffham, solicitor, contra. Mr. Commissioner Fane. — A. B. is protected against all process ; the summons must not be proceeded with. An application for costs was made by Langham. Lucas, contra. — The creditor has failed. He is not en- titled to costs. A. B. ought not to be liable to costs for doing his duty, viz. coming here to have his property distributed. He has given up everything he possessed for the benefit of his creditors, so he has nothing wherewith to pay costs ; at all events, the estate only ought to be charged ; but in that case, as no assignee has been appointed, there is no one against whom an order charging the estate with costs can be made. Mr. Commissioner Fane. — He must pay all the costs prior to the time when notice of his petition and meeting was served on the creditors. (See sec. 213.) go REPORTS OF CASES 1860. (Before Mr. Commissioner FoNBLANQTJB.) Be Ghisholm and Chisholm. Double sitting; ThIS matter occupied the Court for three hours and ^"'ae costs of upwards. double sittings kwed°in pubUo WUMnsou, solicitor, for the assignees, applied to be allowed meetings. ^^ ^^^^^^ ^^^ ^ ^^^y^ ^^^^^^ . j^g j^^^ ^^^ glerks in at- tendance. The CoMMissiONBK.— I will not allow double sittings for public meetings. You may make extra charges for clerks. (Before Mr. Commissioner Fonblanqdb.) Be WooLSET. February ISth. Costs. X HIS was a meeting for the choice of assignees. The bank- double rittin 3 rup* ^^^ examined touching certain money alleged to be in his in public meet- possession. Upou his refasing to make answer, and to sign ings wUl not be ^ , ., , . . . , -ij. j j. xt. allowed. and subscribe his examination, he was committed to tne Queen's Prison. Lawrance, solicitor, for the petitioning creditor, applied to - be allowed costs for bringing the original solicitor for the estate up from the country, on the ground that the informa- tion that he had supplied was useful for the purposes of the examination, and beneficial to the estate. He also appUed to be allowed costs of a double sitting. Mr. Commissioner Fonblanqub. — Under the peculiar cir- cumstances of this case, I will allow the expenses of the country solicitor ; but it is not the general practice to do so : IN BANKRUPTCY. 51 the rule is rather the other way. I cannot allow costs for 1850. double sittings in respect of public meetings ; you must take ~~ one with the other. It would be well to inform the bankrupt Woolsey. that the effect of his conduct will not end in the committal, but it will be taken into consideration again when he comes up for his certificate. Anonymous. Febmairy 2d(A. IN this case the person against whom the petition had been Petition ; filed had only been in trade for a period of ten weeks. It 90^*^™^ ' was therefore impossible to state, according to the printed Where a .. Ill 1 trader, against form of petitmn prescribed by the statute, that he had whom a peti- • 1 1. n . ,1* T,i T ,1 tion for adiudi- camed on busmess for six months immediately preceding the cation haabeen date of the petition, within the district of the Court within ^l^'^- .^^^^ "fi ^ ' been m trade which the petition was filed. ten weeks, the form of petition in the statute Mr. Commissioner Fonblanqtte. — Unless the form is may te altered 1- !• 1 1 111 according to altered to meet the exigence of the case, a trader would be the fact. exempted from the operation of the bankrupt law until he has traded for six months.'" This is not the policy of the law, and cannot have been the intention of the Legislature. Let the form of the petition be altered according to the facts. (Before Mr. Commiseioner Evans.) Ex parte SpARKES, re GeBRING. Tuesday, Mwrch I2th. i HE facts will appear in the judgment. Eight of as- signees to re- tain damages recovered by them in respect of an injury done to the bankinipt through the dishonour of his acceptance, against the holders of the bills. G-. paid a sum of money into hia bankers', with notice to them to apply the same in pay- ment of certain of his acceptances, then about to become due ; the bankers retained the money, and suffered the bills to be dishonoured. Gr. afterwards became bankrupt, and his assignees brought an action against the bank for the injury so done to the bankrupt, and obtained a verdict for a sum equal to the amount due on the bills : , Held, that the assignees were entitled to retain such sum against the holders of the bills, the latter to be allowed, to prove. E 2 52 REPORTS OF CASES. 1850. Ex parte Spabkes, re Geebing. Lawrcmce, solicitor, for Messrs. Sparks (the holders of the bills). — There is no privity between Messrs. Sparks and the bank, therefore we cannot recover from them at law. We contend that the sum paid into the bank by Geering was for a specific purpose, and for our benefit. It was in the nature of a trust, and we are entitled to it in equity. Linklater, solicitor, for the assignees. Wilkinson, for the bank. Judgment. Mr. Commissioner Evans. — In this case, Messrs. Sparks and Co. had taken an acceptance from the bankrupt for the siun of 175^. 2s. 3d. for goods sold and delivered to him by them. When the bill was nearly due, the bankrupt stated to Messrs. Sparks that he had not sufficient money to enable him to pay the bUl unless they would lend him 50^. ; they lent him the 50Z. and he paid into his bankers' a sufficient sum to pay the bills, giving them notice to do so. The bankers allowed the bills to be dishonoured, (a) After the bankruptcy of Geering, his assignees sued the bank for their failure to pay the bill for 1 75/. 2s. 3d. and a verdict was given in favour of the assignees for the sum of 1 75/. 2s. 3d. It has been contended, on the part of Messrs. Sparks, that the as- signees ought to pay over to them the amount of the damages, less the costs of suit, and the following cases were relied on : —Left V. Morris, 10 Sim. 607; Burn v. Carvalho, 10 Myl. & Cr. 690 ; Malcolm v. Scott, 6 Hare, 51 ; Ex parte Hob- house, 2 Dea. 291. In aU these cases the assignees of the bankrupts had property in their hands in trust to discharge certain bills of exchange ; the holders of the bills of exchange, though there was no privity between them and the bankrupts, were held entitled to it, because otherwise persons would be (a) The bankers retained the sum deposited with them for the payment of the bills, in respect of a larger sum which was then due to them from the bankrupts. IN BANKKTJPTCT. 53 enabled to get it, and the disposal of it to the holders of the bills was a relief to that extent of the bankrupt's estate. This was the ground of the decision in Ex parte Wariiiff, 1 9 Ves. 345, on which all the cases cited are founded. In the present case the assignees were not in possession of a property in which Messrs. Sparks had an interest ; the jury might have given one farthing or 10,000^. ; the action was not for an injury done to Messrs. Sparks ; and I am of opinion that those gentlemen are not entitled, either in law or equity, to the amount in question. Of course their proof will be allowed, (a) 1850. Ex pm-te Sparkbs, re Geehing. (Before Mr. Commissioner Fonblanqtie.) Ea; parte Dendt and Others, in re Chisholm. ■^ Mm-chimh. i HE following are the facts stated in the petition : — That, Uncompleted previous to the bankruptcy, the petitioners were mortgagees, Powerof'tlie amongst other premises, of the fee-simple of the Dorking ^si^^e^es'tcf^'^ Waterworks, and of a messuage and grounds adjoining, elect; Whether a conveyance is a deed or an escrow ; Con- tract to be voided on both sides. The bank- rupt, previous to the bank- ruptcy, entered into a contract for the pur- Mont. & Ayr. 316. As to want of chase of land, privity, see HUl v. Smith, 12 M. & which he foiled W. 818 ; Alder v. Eeighley, 15 M. *« perform. A » -m- , , y subsequent ar- rangement for the purchase was entered in- to, and a draft conveyance was delivered to the vendor, containing recitals that part of the purchase-money was paid. The money, in feet, was not paid. A sum of money was paid to the vendor in part payment of a forfeited deposit : Held, that the conveyance was an escrow, and not a completed assignment ; and that the assignees ought to elect to complete or not : if not, mutual credit to be given for all sums paid and received respectively ; the contract to be void a6 initio. subject to a prior mortgage to one Kerrick. On the 15th of June, 1848, the petitioners, with the consent of Kerrick, caused the premises referred to, with others, to be put up for sale by auction, subject to certain conditions of sale. The third of such conditions was in the following words : — " That every purchaser shall, immediately after the sale, pay a de- (a) See Lord JSraybrooh v. Me- redith, 13 Sym. 271 ; Parsons v. MiddUton, 6 Hare, 261 ; Hassd v. SmytTiers, 12 "Ves. 121 ; Hx parte Parr, Buck. 191 ; Ex parte Prescott, 54 REPORTS OF CASES 1850. JSx parte Denbt and Others, re Chisholm. posit in the proportion of 201. for every 100/. of his purchase- money, into the hands of Mr. Wm. Ley, the vendors' solici- tor, and sign an agreement for payment of the remainder on the 29th day of September next, at the olEce of Wm. Ley, at No. 3, Bream's-buildings, Chancery-lane, London, at which time and place the purchases are to be completed, and pur- chasers to be let into actual possession, or into the receipt of the rents and profits of the respective lots, up to which time all outgoings as to such part of the property as shall be in hand, and all outgoings payable by the landlord, of such part thereof as shaU not be in hand, will be discharged by the vendors ; and if from any cause whatever any purchase shall not be completed on that day, the purchaser shall pay interest on the unpaid portion of his purchase-money, and on the valuation mentioned in these conditions, at the rate of 51. per cent, per annum until completion." The fourteenth con- dition was as follows : — " That if any purchaser shall neglect or fail to comply with the above conditions, his deposit shall be thereupon actually forfeited to the vendors, who shall be at full liberty to resell the lots purchased by such person, and either by public auction or private contract, at such time and place, subject to such conditions, and in such manner as the vendors shall think fit, and the deficiency in price (if any) which shall happen on such second sale, and all expenses attending the same, shall immediately after the same be made good and paid to the vendors by the defaulter at this present sale ; and in case of nonpayment, the whole or such part of the same as shaU not be paid shall be recoverable by the vendors as and for liquidated damages." At the sale, the bankrupt, "William Chisholm, became the purchaser of the premises comprised in lot 1, comprising the waterworks, for the price of 4,020/., but, being unable to pay the deposit, signed a contract for his purchase, written at the foot of a printed copy of the conditions of sale, and gave the vendors a promissory note for 804/. engaging to pay the same and the residue of the purchase-money on the day and in the manner IN BANKRUPTCY. 55 set fortli in the third condition of sale. The petitioners in all respects performed the conditions of sale. The said bankrupt did not perform his agreement to pay the promissory note and purchase-money, but in the draft of the conveyance by his soHcitor to the solicitor for the petitioners, about the 29th of September, it was recited, that Kerrick had agreed to allow the sum of 3,000/. to remain on mortgage of the water- works ; and it was witnessed that, in consideration of 600/. expressed to be paid by the said bankrupt to Kerrick, and of 520/. to be paid to the petitioners, the premises were conveyed to the said bankrupt, subject to Kerrick's mortgage. The said bankrupt did not complete his purchase, and was adjudicated a bankrupt on the 20th of November, 1849, and assignees were chosen under the bankruptcy, but 300/. was paid to the petitioners in part payment of the deposit, and the petitioners paid Kerrick all that was due to him in respect of his mortgage, except the 3,000/. The prayer was, that the assignees might be forthwith ordered to elect whether they would abide by and execute the agreement of the said bankrupt, or abandon the same ; and if they should elect to execute the same, that they might be ordered forthwith so to do ; and if they should elect to abandon the same, that they might be ordered forthwith to deliver up the agreements, if any, in their possession, and also possession of the said premises, and may be ordered to pay the peti- tioners all rates and rents received by them for or in respect of the said premises since the said bankruptcy, and that the petitioners might be at liberty to retain the said sum of 300/. paid in, part of the said deposit as aforesaid, and for the further order of the Court. 1850. Ex parte Dendy and Othees, re Chisholm. Bagshawe, counsel, for the petitioner. — Is this a complete assignment or not ? and are we to consider the instrument produced as a deed or an escrow ? It is conceded that the recital in the conveyance of the 29th September is not true ; it could not have been intended that the bankrupt should 56 REPOETS OF CASES 1850. have possession of the deed except until the consideration- money should have been paid. The contract was not deli- "deC? vered over, nor would it be until the conditions contained in and Othees, j^. gj^^^^ j^^^g ^^^^ performed by the purchaser. This instru- Chisholm. ment must be considered an escrow, and not a complete conveyance. (Bowker v. Burdaker.) No legal estate has actually passed. Kerrick, in whom the legal estate resides, is not a conveying party. Neither, under the circumstances, has any equity passed to the bankrupt or his assignees. But we have a lien on the land for the unpaid purchase-money, therefore the premises cannot be considered to belong to the general estate. The conveyance is as yet incomplete, and the assignees ought to elect whether they will complete or not. Stemns, solicitor, for the assignees. — The vendor is in the common case of a vendor who has not received his purchase- money — he is now in the condition of an equitable mortgagee. The petition is inconsistent ; it prays that the contract may be dehvered up, but that the petitioners are to retain the benefit of it. If the contract is voided, it must be voided altogether, and the condition for forfeiture of deposit must be given up with the rest. If the assignees are to account for the rents, rates, &c. they ought to be allowed to take credit for the paid portion of the purchase-money. That would restore the parties to their original rights. Mr. Commissioner Fonblanqtie. — I consider this convey- ance an uncompleted contract, within the meaning of the statute, (a) sec. 146. And the assignees are bound to elect (a) That if any bankrupt shall have entered into any agreement for the purchase of any estate or interest in land, the vendor thereof, or any person claiming under him, if the assignees shall not (upon being thereto required) elect whether they will abide by and execute such agreement, or abandon the same, may apply to the Court, and the Court may thereupon order them to deliver up the agreement and the possession of the premises to the vendor or person claiming under him, or make such order therein as the Court shall think fit. IN BANKRUPTCY. 57 as to whether they will abandon or execute the agreement 1850. within a reasonable time. An account ought to be taken of ' ' ° _ _ Jix parte the rent and rates received by the bankrupt or his assignees, Bendy ind Others giving credit for all outgoings, and the 3001. paid to the „ petitioners may be set off against the rent and rates, the Chisholm. balance, if any, to be paid to the parties entitled. The assignees are entitled to be allowed aU reasonable expenses incurred in keeping up the works. I will make no order as to costs. Re Hart. J.' HE assignees originally chosen under this bankruptcy had A creditor who been removed, and this was the meeting appointed for the j^jg contemplation ; it was denied that it had been ever carried into elfect. Lawrance, soUcitor, was for the proof. Linklater, sohcitor, contra. 65 1850. Ex parte Cheatham, re Woods and Thomas. After hearing the evidence of Cheatham and of the bank- rupts, and the arguments on both sides, Mr. Commissioner Fonblanque. — I do not think that the evidence I have heard to-day is sufiEicient to establish the fact of a partnership, though it seems clear that a partnership was contemplated ; but it may hereafter be proved that the part- nership was actually estabKshed. I shall, therefore, admit the proof tendered as a claim, with liberty to convert it to a proof in six months, provided that within that time no cre- ditor shall have obtained a verdict at law against Cheatham as a partner with the bankrupts. (Before Mr. Commissioner Holboyd.) Anonymous. In this case a trader had been summoned for a debt of lOOZ. ; Trader-debtor the debt was admitted, with the exception of 16^. a disputed Act™f bank- discount account. No bond had been ordered, and the time ™ptoy- , Where the given in the statute had elapsed since the debtor appeared in greater part of , , . . . 1 the debt is ad- obedience to the summons. fitted, and an The summoning creditor now filed a petition, and moved j^^'^ereTs^a that the debtor might be adjudicated a bankrupt, relying on good defence to . the residue, not the payment ot the residue. paying or com- pounding for the residue in time is not an act of bankruptcy. 66 1850. ANONTMOnS. EEPOETS OF CASES Mr. Commissioner Holkotd. — Refer to sec. 82 («) of the Bankruptcy Law ConsoUdation Act. The debtor made the necessary deposition that he has a good defence to the disputed part of the debt. In such case his not paying or compounding for the same is not within the terms of the statute. I must dismiss the petition. (Before Mi-. Commissioner FonblanquB.) Wednesday, February 6tk. Trader debtor ; Summons ; In- dorsement. Sunmions must be in- dorsed witli the name of the so- licitor or party suing it out. Anonymotjs. X HIS was a trader-debtor summons. It was objected on behalf of the party summoned, that a description of the trader debtor not required by the statute and schedule had been added to the proper form ; and that the affidavit in support had not been headed " In the Court of Bankruptcy," and that the summons was not indorsed with the name of the solicitor, {a) That if any such trader so summoned as aforesaid shall, upon his appearance, sign an admission for part only of such demand in the form aforesaid, and shall not make a deposition in the form aforesaid, that he believes he has a, good de- fence upon the merits to the residue of such demand (if required by the Court so to do), and enter into such bond aa aforesaid to pay such sum or sums aa shall be recovered, to- gether with such costs as shall be given in any such action as afore- said for the recovery of such residue, then and in such case, if such trader, as to the sum so admitted, shall not within seven days next after the filing of such admission pay or ren- der, and offer to pay, to such cre- ditor the sum so admitted, or secure or compound for the same, to the satisfaction of the creditors as to the residue of such demand, or shall not, within seven days after personal service of such summons, or within such enlarged time aa may be grant- ed to him in that behalf, pay, se- cure, or compound for the same to the satisfaction of such creditor, or enter into a bond in such sum, and with two sufficient sureties as the Com-t shall approve of, to pay such sum as shall be recovered in any ac- tion which shall have been brought, or shall hereafter be brought for the recovery of the same, together with such costs as shall be given in such action, every such trader shall be deemed to have committed an act of bankruptcy on the eighth day after service of such summons, provided a petition for adjudication of bank- ruptcy shall be filed against such trader within two months from the filing of such affidavit. IN BANKRUPTCY. 67 but the affidavit in support was so indorsed by the party who 1 850. issued it Anonymous. Mr. Commissioner Ponblanque. — The addition of the description of the party summoned is mere surplusage, and does not affect the validity of the summons ; it would have been better if the statute had required such a description. The omission in the heading of the affidavit is an informality, but not fatal. The want of the proper indorsement on the summons is fatal. The party summoned has a right to be informed as to whom he ought to apply to settle the claim. The summons must be dismissed, with costs. The affidavit is no part of the summons, and therefore the indorsement on it will not cure the defect in the summons. Ex parte Lewis and Others, in re Arber. J. HE petition stated, amongst other things, that on May 5, Removal of an 1833, Samuel Wright was chosen and appointed assignee of cmte!*^' the estate and effects of the bankrupt ; that in the balance- ,.,^'^f''® ^^' '^ tition has been sheet of the bankrupt, filed November, 1833, it was estimated presented to , , ,., Ill 1 <., ^ cr^ remove an as- that there would be a probable surplus, alter payment ot 20s. signee, and in the pound, of 6,349/. 13s. 4d. ; that the said Samuel a^'etMhe^pe- Wright absconded from England, and is now believed to be titioner must . pay costs. in America ; that no dividend has been paid under the said bankruptcy. The prayer was that Samuel Wright might be discharged from the office of assignee, and for a new choice. Bew, solicitor, for the petitioners. — The affidavit in support is a transcript of the petition. The Commissioner. — The affidavit is not sufficient as to Wright's -absconding. Let the application stand over for a 68 1850. Ex parte Lewis and Others, in re Abbek. REPORTS or CASES week ; if I am then satisfied that Wright has absconded, I will make the order prayed for. The costs must be paid by the petitioners, and they will be at liberty to prove for them in case any assets shall be got in. (Before Mr. Commissioner Holroyd.) Friday, February 8th, Renewal of protection. On an appli- cation on be- half of a bank- rupt for the ex- tension of his protection, the Court will not consider objec- tions arising out of matters foreign to the bankruptcy. So; parte Palmer, re Allison. U PON hearing the certificate, the Court was pleased to order that the certificate should be suspended for two years, and to grant protection for three months, to be renewed at the expiration of that time, and from time to time afterwards at similar periods. One of these terms had expired, and the bankrupt now applied for a renewal of the protection. Lucas, counsel, for the opposing creditors. — We are mortgage creditors ; the mortgaged property has been realised, and there was a deficiency, for which we have proved. We commenced proceedings at law to recover the interest which had accrued and become due on the mortgage debt, and the bankrupt has put in many vexatious pleas to our action, by means of which we have been put to considerable expense. The bankrupt is now carrying on an extensive business, although he has as yet no certificate. Under these circumstances, we submit that there ought to be no further enlargement of the protection. Lawrance, soHcitor, for the bankrupt. — As to the charge against the bankrupt that ho is now carrying on trade, he is doing so as the salaried servant of another person, namely, the purchaser of the business and premises from the assignees, who considered that, as he is well acquainted with the trade in question, and well known to the public, his services would be valuable. There has been an intention that the business IN BANKRUPTCY. 69 should be earned on partly in the bankrapt's name, but that intention has not been carried into effect. Mr. Commissioner Holrotd. — I must take measures to prevent the bankrupt from entering into trade, and holding out his name to the public as a trader while the certificate is suspended. As to the vexatious pleas, that is a matter which ought not to be brought before this Court now. The opposing creditor has elected to seek his remedy in another place, instead of proving in bankruptcy ; and I cannot entertain his objection in respect of matters foreign to the bankruptcy ; it would have been otherwise if his objection had arisen out of any matter relating to that part of the debt which has been proved. I wiU extend the protection for two months, on condition that the bankrupt will not permit his name to be used in the trade in question. 1850. JBx pa/rte Palmer, re Allison. Tuesday, Fdymami Vlth. (Before Mr. Commissioner Fonblanqde.) Re Sparrow. J. HE bankrupt came up on the question of certificate. Certificate. No certifi- cate "will be Turner, solicitor, for opposing creditors. — The bankrupt's |[^°gf "^^h^r expenses have been excessive, and he has kept no cash-book, the bankrupt has kept no cash-book. Sturgeon, counsel, for the bankrupt. Mr. Commissioner Fonblanqt:e. — I will never grant an immediate certificate to a bankrupt who has failed to keep proper books, and most particularly a cash-book ; that is the most important book of all : it tests the accuracy of all the other books, and shows the expenses from day to day. The certificate must be suspended for six months. I wiU allow protection. 70 REPORTS OF CASES 1850. The above judgment was repeated almost verbatim in Re Smith. Febnuwy 13«A. (Before Mr. Commisaioner GOULBDBN.) Satmday, ANONYMOUS. February 2Srd. Trader debtor ; A HIS was a trader-debtor summons issued against three agai^t mrt- partners for a partnership debt. The question was, whether ners ; Separate each partner should make a separate admission of the debt, admissions. ., . . Where a or whether the admission of one would be taken for all. trader-debtor summons issues against a firm, y^y.^ Commissioner Goulburn. — On looking at the statute and the debt is ° admitted, each and Schedules annexed, I am of opinion that each partner tomakeas^pa- should make a Separate admission. Another reason is, that rate admission, gj^^^^j -^ ultimately be sought to make these partners bank- rupt, a separate act of bankruptcy must be established against each ; that wilt be best effected by making each liable to pay, and compound on a separate admission. (Before Mr. Commissioner Holeoyd.) Mmiday, ANONYMOUS. February 25th. On a petition i HIS was an application arising out of a petition for under the arrangement. trader-debtor ° arrangement sections (Bankrupt Law WHMns, soKcitor. — I am for two creditors ; one holds a Ac°,^°i849,'°" judgment. I am entitled to require that the creditors who the fssentin"*'^ Consent to the arrangement should prove their debts. The creditors may hona fides of their claims ought to be established before the prove their other creditors are deprived of their common law rights. debts. IN BANKRUPTCY. 71 Mr. Commissioner Holroyd. — The debts must be proved ; 1850. but the iiKjuiry must be private. I will sit up-stairs for that purpose. Anonymous, (Before Mr. Commissioner Fonblanque.) Me West. Tuesday, ^February 26th. J_N this case the petitioning creditor, who was an attorney, Solicitor; applied to be allowed his costs under sec. 114. creditor'"costa. A petition- ing creditor JIale, solicitor, for the petitioning creditor. — By the Statute who is an at- of Gloucester, if a party to a suit be an attorney, and act entitled to for himself, and is successful, he is entitled in costs, not only ''°^*? T^* "^ to his disbursements, but to such fair professional charges as he might claim against the other side if he had been employed by a third person, save charges for instructions. Walker, a solicitor, contra. — Mr. Commissioner Holroyd, in lie Butterfield, (a) decided professional charges were not to be allowed, but expenses and money out of pocket may be allowed, subject to the discretion of the Taxing Master. Mr. Commissioner Fonblanque. — I have consulted with Mr. Evans and Mr. Holroyd, and we are unanimously of opinion, that when the petitioning creditor is an attorney, he is only entitled to his expenses, and that he can charge nothing- for costs as an attorney. (a) Not reported, but the Editor Mr. Commissioner Holroyd's judg- has been favoured by a perusal of ment. 72 REPORTS OF CASES 1850. Wedmesday, Pebruary 2^th. Certificate ; Assignees op- posing. When as- signees may oppose the cer- tificate without giving notice. (Before Mr. Commissioner Fake.) Be RUSHBKOOK. 1 HE bankrupt came up for his certificate. Sturgeon, counsel, for the assignees, opposed. Duncan, counsel, for the bankrupt, objected. — The assignees had given no notice of their intention to oppose. (Refer to sec. 198.) Mr. Commissioner Fane. — It is the duty of the assignees at all times to inform the Court as to the state of the affairs of the bankrupt ; I must hear them now. Note. — It may be doubted whether this decision would apply to assignees opposing, not in their character of assignees, but on matters personal to themselves. This question was raised by counsel, but was withdrawn. MaircJi 6th. (Before Mr. Commissioner FoNBLANQnE.) He Woods and Thomas. 1 HE bankrupts applied for their certificate. Certificate of the second class ; Right of the assignees to oppose without giving notice, (a) The assignees have a right to oppose the granting of the certificate in respect of any question relating to the estate and effects of the bankrupt, notwithstanding that such opposition may be in respect of the bank- rupt's conduct towards an individual creditor who has given no notice of opposition. (a) Bankrupt Law Consolidation Act, 1849, sec. 198. Lawrance, solicitor, in support. Linhlater, solicitor, for the assignees. — We are satisfied IN BANKRUPTCY. 73 with the general conduct of the bankrupts towards us ; the 1850. trading has been regular, and the books well kept. There is ~ a complaint by an individual creditor that may affect the Woods general estate, but that creditor has given no notice of op- Thomas. position ; am I at liberty to go into his case ? Mr. Commissioner Fonblanqub. — Every creditor should rely on his own particular case ; but there may be circum- stances under which the conduct of a bankrupt towards an individual creditor may affect his general estate and his gene- ral conduct as a trader ; in such a case it is the duty of the assignees to oppose the allowance of the certificate in respect of such conduct so far only as it may concern the interest of the general body of creditors. The case then proceeded. After hearing both sides, Mr. Commissioner Fonblanqtje. — The mode of trading pursued by the bankrupts is not impeached. The only objection is that the losses and expenses so far exceed the profits. The trading ought to have been brought to a close sooner. The objections offered by the assignees in respect of the bankrupts' conduct towards one of their creditors at first appeared suspicious ; but that has been explained. The books have been weU kept ; and there are many points in the bank- rupts' favour that make this case more meritorious than the average number of cases that come before this Court. But I must be careful not to deteriorate the value of first-class cer- tificates by granting them indiscriminately, and as the bank- rupts did not wind up their affairs in proper time, I cannot certify that their bankruptcy was caused wholly by unavoid- able loss and misfortune ; I wiU, therefore, allow the certificate immediately, but of the second class. 74 KEPOKTS OF CASES 1850. Solicitor and client ; Privilege. A solicitor is bound to answer as to all matters confided to him by his client, which the client himself would be bound to an- Be Elliott. A SOLICITOR, under examination, was questioned as to matters relating to the estate of his client, the bankrupt. The witness submitted that his knowledge of the matter in question arose from a communication made to him by his client, that such communication was privileged, and that he was not bound to answer. Mr. Commissioner Fonblanqtje. — The privilege is the privilege of the client, not of the solicitor. The bankrupt would himself be bound to make answer as to any matter touching his estate and effects. Satwrday, February 23rd. Practice ; Ad- vertisements. Where a trader has peti- tioned under the Bankrupt Law Consolida- (Before Mr. Commissioner Fane.) Re Catchpole. T HE facts are stated below. JUDGMENT. The Bankrupt Law Consolidation Act, 1849, has intro- duced, by a series of clauses, from 211 to 223, a new method 211 as'eq^sjii ^^ proceeding, called " arrangement between debtors and creditors under the control of the Court of Bankruptcy," under which debtors are at liberty to bring their own cases before the Court in a manner comparatively private. The debtor's insolvency is not to be gazetted in the first instance, and the sittings are to be private. This method of proceeding been adjourned seems to have been intended as a concession to debtors whose Se"a§udic^ ' inability to meet their engagements is attributable rather to tionmustbe misfortune than delinquency, and to be founded on the as- advertised -^ ■' forthwith. Semble. — A trader declared bankrupt in consequence of failing to make out a. case for arrangement under the statute, cannot dispute the adjudication under sec. 104. has failed to comply with the provisions required by the statute, and has been adju- dicated a bank- rupt, and the matter has IN BANKRUPTCY. 75 sumption that the mere fact of a debtor voluntarily coming 1850. forward and placing himself and his property at the disposal of the Court is prima facie evidence of the debtor having Catohpole. an honest case to lay before the Court, and intending to act honestly by his creditors. The law, however, recognising the possibility of a dishonest debtor assuming the character of an honest man, has provided, by c. 223, that on evidence of dis- honesty all privacy shall cease, and that the debtor shall be dealt with as a bankrupt ; and it accordingly provides, amongst other things, that if at any time after the filing of a petition for protection, it shall be shown to the satisfaction of the Court, by any creditor, that the debtor has been guilty of any one of certain acts of misconduct there specified, " the Court may adjudge the petitioner a bankrupt, adjourn all further proceedings into the public court, advertise the adjudication, and appoint sittings for choice of assignees and for last exa- mination, as in bankruptcy." One Catchpole presented to the Court a petition for arrangement under these clauses on the 14th day of February, and protection was granted to his person and property on the same day. On the 20th, applica- tion was made by a creditor for a sitting to show that the petitioner had contracted a debt without reasonable proba- bility at the time of contract of being able to pay it, which is one of the delinquencies specified in c. 223, and on that ap- plication I appointed a sitting for the purpose of such inquiry, and summoned the debtor to attend. He did not attend, and I proceeded to hear the creditor in his absence, and being of opinion, on the inquiry, that the debtor had contracted the debt without reasonable prospect at the time of contract of being able to pay it, I adjudged the petitioner a bankrupt, and adjourned all further proceedings in the matter into the public court. A question, however, has been suggested, whether I ought at once to advertise the bankruptcy or postpone the advertising until a duplicate of the adjudication has been served on the petitioning debtor so adjudged bankrupt, and at least seven days have elapsed from the service of such dupHcate, 76 REPORTS OF CASES 1850. to enable the petitioning debtor to show cause against the ad- judication, in accordance with sec. 104 of the late Act, it being Catchpolb. suggested, that as by c. 223 the proceedings after adjudication are to be, as the expression in that clause is, "as in bank- ruptcy," no advertisement ought to take place except in exact accordance with the provisions provided for ordinary bank- ruptcy by sec. 104. I have carefully considered this question, and I am of opinion that an adjudication under c. 223 is neither within the words nor the spirit of sec. 104. It is clearly not mthin the spirit, because sec. 104 is founded on the obvious justice of not pubKcly denouncing a man as a bankrupt without giving him at least an opportunity of show- ing that he ought not to have been adjudged bankrupt at all. By the law of bankruptcy, adjudication on the application of a petitioning creditor is an ex parte proceeding, and although on such ex parte proceeding seizure of property might not unreasonably take place, it was thought that the bankruptcy ___ should not be advertised, and hence sec. 104 provides that the alleged bankrupt shall have an opportunity of being heard before being gazetted ; but in the proceeding under c. 223 he would be heard, as matter of course, before any adjudication at all, for no commissioner would adjudicate under that clause without appointing a sitting for the purpose of hearing both parties, and causing the petitioning debtor to be summoned ; and the petitioning debtor was accordingly summoned in this case. Neither is the present adjudication within the letter of sec. 104, for by that section the alleged bankrupt has seven days given him only for the purpose of showing that " the petitioning creditor's debt, or the trading, or the act of bank- ruptcy upon which the adjudication has been grounded, are insufficient to support such adjudication." But here the ad- judication is not grounded upon any one of those requisites. The want of a petitioning creditor's debt or act of bankruptcy is quite immaterial. No debt or act of bankruptcy is needed, and as to the alleged debtor not being a trader, he at least could never be admitted to show that he was not a trader, for IN BANKRUPTCY. 77 Ms petition, under c. 211 and 212 and the Schedule Aa, re- 1850. presents him to be a trader, which must be conclusive against him as by estoppel. On the whole, therefore, I am of opinion Catchpole. that the adjudication must be advertised at once. (Before Mr. CommiBsioner GoDLBURN.) Re A Disputed Adjudication. Satw-day, March 2Srd. X HE acts of bankruptcy relied on were that the trader Disputed ad- against whom the petition for adjudication was filed had Evidence!' denied himself to creditors, and that he had absented himself Declarations made by the from his usual place of business. Depositions made by the wife and ser- wife and servant as to declarations made b y them to creditors trader, made in were relied on in support of the adiudication. ^'^ ^^!!"'?ii, ^^ ^ are part oi the It was contended, on the other side, that such declarations, rmgut^ ex- . .,., _, ^ ,- aminations of not having been made in the presence of the trader, could not the wife and T_ • 1 servant as to be received. ^^^ ^^.i^^a- tions may be received in Bagley, for the petitioner. evidence. Lawrance, solicitor, contra. Mr. Commissioner Goulburn. — The question is, can I receive evidence of the denials by th e wi fe and servant o f the trader sought to be made a bankrupt ? It is a very common error to suppose that such declarations, when made in the absence of a party, are hearsay, and cannot be admitted in evidence. The declaration may be a fact, and then it is evidence. Here the denial is a most material fact, and part of the res pesta. The Court ought, therefore, to be informed ' of its extent, and for that purpose the person who made it must be examined. (1 Ph. on Evidence, 148, 3rd edit.). In Attorney-Generals. Good, M'Cl. & Yo. 286, it was held that /t. 78 EBPORTS OF CASES 1850. a denial was part of the res gesta, and could not be proved but by tbe person who made it. That case was nearly pa- A D^piTTED rallel to tbe present, but stronger, for it was a crown case, Abjudication. ^^^ ^^^ judges would have been careful how they admitted evidence which might fix a party with penalties. Here the denials are facts, which must be combined with the other facts of the case to lead the Court to a correct conclusion. In GJiarrington v. Browne, -it Moore, 462, it was held that evidence might be received of the fact of a wife telling a creditor that her husband was out. The same principles ,JWere laid down in Fisher v. Boucher, 1 1 Moore ; and Fisher {and Another v. Boucher, 10 Barn. & Cr. 705. My opinion, : ' ^ ' \ therefore, is, that the evidence ought to be received. Adjudication confirmed. (Before Mr. Commissioner Fane.) April itlh. Ex parte William Good and John Good, re Richard Good. J. HE facts are stated below. JUDGMENT. Mr. Commissioner Fane. — This was a petition of two cestui que trusts under a will, praying that trust property Breach of trust ; Lien ; Proof. A testator, by his will, dated 1816, gave the onus of his property belonging to the bankrupt under that will might be sold, and lUe, remaLder *^^* ^^^ proceeds might be applied in satisfaction of a demand to his children, of 47.9Z. 16s. 8d. which the executors under the will, of whom and appointed his son, the bankrupt, and his widow, executors. The trusts of the will were, inter alia, that the execu- tors should carry on the testator's business, retaining therein the sum of l,200i. The bank- rupt and his mother carried on business till 1821, when the widow retired from business, and the bankrupt, by deed, admitted that there was a sum of 497i. odd in the business, and agreed to pay the widow an annuity, and allow interest on the capital remaining in the business. The adjudication took place in November, 1849 ; Held, that the cestui que trusts had an equitable charge on the bankrupt's interest under the will for the sum of 497Z. odd, and that this property under the will ought to be sold, and if insufficient to realise a sufficient sum, that the cestui que trust might prove for the residue. EiohabdGood. IN BANKRUPTCY. 79 the bankrupt himself was one, had against the bankrupt, in 1850. respect of a breach of trust committed by him, and that proper persons might prove for such part of the 497/. odd, if any, as William Good the sales did not cover, and that if necessary the bankrupt's jqhn good interest in the proceeds of the proof might also be applied in the same way. The circumstances were these : — The bank- rupt was co-executor with his mother and one Davis, under his father's will. The father, by his will, dated in 1816, gave the mass of his property to his wife for life, remainder to his seven children equally ; and he appointed his eldest son, the bankrupt, and his widow and Davis, his executors. The father had carried on the business of a stationer for many years ; and he directed that the bankrupt should carry it on untU the year 1822 for the equal benefit of himself and his mother, retaining in the business a capital of 1,200/. stated by the testator to be in it at that time, namely, 1816. In 1821 the father died, and the mother and the bankrupt continued the business. There is no evidence to show that 1,200/. or any other sum, was in the business in 1821, but by a deed executed in 1834, between the bankrupt and his mother, he admitted that at that time there was 497/. 16s. 8d. capital in it ; and on his mother's retiring from business in 1834, he agreed to pay her an annuity for the good- will, and allow her interest on the 479/. 16s. 8d. In November, 1849, Good became bankrupt. Under these circumstances, it is clear that those who represent the testator's estate are enti- tled to prove for the 479/. 16s. 8d. But the petition went further, and insisted that the co-trustees had an equitable lien on aU the property of the testator still remaining undis- tributed in which the bankrupt had any beneficial interest, to secure payment of the 497/. 16s. 8d. and that they had a right, as against the bankrupt and his general creditors, to have such equitable lien enforced by selling such beneficial interest, and applying the proceeds in satisfaction, as far as they would go, of their demand for 497/. 16s. 8d. and to prove for the difference, and that they were further entitled to have 80 REPORTS OF CASES 1850. the bankrupt's reversionary interest in such proof, subject to the life interest of his mother, applied in farther satisfaction Ex pajrie William Good of the demand of the co-executors. These claims are evidently JoHN^oD founded on a principle adverse to the spirit of the bankrupt J, '■'' laws, which spirit is, that where a loss is sustained owing to insolvency, all creditors shall share the loss proportionally; for if these alleged rights are conceded, then the co-executors of the bankrupt, who, as between themselves and their cestui que trusts, have been guilty of a breach of trust, and are, therefore, liable to their cestui que trusts, will, as between themselves and all the other creditors of the bankrupt, get nearly 20s. in the pound, and the other creditors will get next to nothing. I there- fore originally looked at these asserted rights with a strong in- clination against them; but a careful examination of the autho- rities has forced me to the conclusion that there is too much authority for them to admit of their being resisted. Formerly the law was in some respects held otherwise. The earliest case I find on the subject is Ex parte Smith,- Go. Bankrupt Law, 212, decided in 1741, where it was held that a trustee for the bankrupt, being creditor of the bankrupt as such trustee, should prove, but that the dividends on the proof should be invested, and the annual proceeds which were payable to the bankrupt for life under the trust should be paid to his assignees for the general creditors. In Ex parte Groome, 1 Atk. 115, heard in 1744, the judge said, "If a husband becomes bankrupt after a breach of payment to trustees, they have always been admitted creditors ; but the CoTU-t has taken care that the interest of the money shall be paid to the creditors under the commission during the life of the husband." In Ex parte Smith, stated in PHddy V. Rose, 3 Mer. 106, it was ordered, under similar circum- stances, that the dividends, on a proof, should be invested in Government stock, and the annual proceeds of the stock paid to the assignees as part of the estate of the bankrupt. And, in 1789, a similar order was made in the case of Stratton v. Hale, 2 Br. C. C. 490. All these decisions seem KichakdGood. IN BANKRUPTCY. 81 consistent with the spirit of the bankrupt laws. But in 1850. 1832, in Ex parte Turpin, Mont. 443, the Court of Review, " J. J. . ,■; 1 Expm-te tounding itself partly on a general principle that a bankrupt's William Good assignees can have no rights higher than those of the bank- john'good, rupt, and partly on a case of Ex parte Maister, re Ramsay, heard in 1816, and cited in Ex parte Turpin, Mont. 452, n. determined that the dividends, on a proof, should be invested in Government stock, and that the accruing dividends on the stock should be retained (so far as regarded any interest the bankrupt had) to reinstate the trust fund. Since that time, the same law has been laid down in Ex parte Smith, re Manning, 2 Mont. & Ayr. 536 (1836) ; and in Ex parte Gonne, re March, 3 Mont. & Ayr. 166 (1837). The prin- ciple upon which the latter cases were decided being that which I have above stated — namely, that the rights of the assignees and creditors of the bankrupt co-trustee cannot be higher than those of the bankrupt himself ; and it being assumed as clear Chancery law, that the bankrupt trustee, if not bankrupt, conld not have enforced satisfaction of any equitable demand he might have had tinder the trust against his co-trustees, without first reimbursing the trust estate what it had lost by his breach of trust, it would neces- sarily follow that the co-trustees would in such case have a similar lien on any other trust funds in their hands belonging to the bankrupt trustee : and accordingly it has been so held, and in very early times, too, it must be admitted. In Ex parte Mitford (1784), stated by Sir W. Grant in Priddy v. Base, 3 Mer. 105, a bankrupt had covenanted to pay 6,000^. to the trustees of his marriage settlement, and, on the other hand, the trustees were liable to pay him 24/. a year, and the dividends of certain stock j and it was ordered in bank- ruptcy that the trustees should be at liberty to retain the 24/. per annum and the dividends on the stock, " towards satisfaction of" the sum due to them from the bankrupt. In Priddy v. Base, Sir William Grant, in 11 87, declared, even as against a special assignee of the cestui que trusts' Q EichakdGood. 82 REPORTS OF CASES 1850. interest, that the trustees could retain. " I apprehend it to ' be clear/' said he, " that the cestui trust could not have WiLLiiMGooD claimed a benefit under the settlement, without making good John'good ^® P^"^* °^ ^*'" " Supposing he had become a bankrupt, the »■« trustees would have this equity as against the assignees;" and he cited Ex parte Mitford. In Ex parte Tu/rpin, Mont. 443, the Chief Judge, giving the judgment of the Court, cites the dictum of Sir WiUiam Grant in Mitford V. Mitford, 9 Ves. 87, p. 100 : — " But is an assignee under a commission placed in a different situation from the bank- rupt himself ? I have always understood the assignment from the commission, like any other assignment by operation of law, passed his rights precisely in the same condition as he possessed them ; they (the assignees) take subject to whatever equity the bankrupt was liable to." And in that case the Court acted on the principle, and also in subsequent cases. In Ex parte Gonne (1836), 3 Mont. & Ayr. 166, the Court ordered a sale of another interest which the bankrupt took under the trust, in order that the proceeds might be applied, so far as they would go, in diminishing the sum to be proved. Chief Justice Erskine saying, " This is not, strictly speaking, a lien on the part of the trustees, but an equitable right to withhold, &c. till the 2,100/." (the sum in question due by the bankrupt) " is made good ;" and in Ex parte Hardman, re Molineux, 3 Mont. D. & De Gex, 569 (1844), an order was made by Vice-Chancellor Knight Bruce in exact con- formity to the relief asked in this case. Under these cir- cumstances, although I regret that trustees and cestui que trusts, who have slept upon a breach of trust for twenty years and upwards, should be rescued from all loss at the expense of all the other creditors, I must declare that the executors under the testator's wiU have a lien on all the interest which the bankrupt took under that will, and that those interests must be ascertained and sold, and the proceeds be applied in reduction of the sum of 497/. 16s. 8d. and that the executors must be admitted to prove under the bankrupt's estate for the IN BANKRUPTCY. 83 difference, and that the dividends on the sum to be proved 1850. must be invested in Government stock, and that the executors ' 1-1111 -1 Ex parte may retain any interest which the bankrupt may have m the William Good accruing dividends until the debt of 497/. 16s. 8d. is fully jqhn Good, paid and satisfied. „ ''<' ^ EiohardGood. (Before Mr. Commissioner FonblaNQDE.) Ex parte Carter, re Carter. Friday, Apnl \9th. X HE bankrupt was a solicitor, and also carried on the Bankrupt's 1- J. ... j.j^fi.1, books ; Certi- busmess oi a newspaper proprietor, m respect oi which he was ficate. adjudicated a bankrupt. ^ '°l^"*r *' . ^ wno enters in- to trade is Mas, soUcitor for the bankrupt, applied for the certificate, tooks as°£^^^^ No creditor opposed. trader, it is not sufficient that he has Mr. Commissioner Fonblanqtje.— It appears, on the face l^^pt accounts Ti 1 after the man- 01 the balance-sheet, that the bankrupt did not keep proper ner of soli- books as a trader. *" °'^^' Nias. — The whole of the estate has not been embarked in the trade. The accounts have been kept after the manner in use amongst solicitors. Most of the items are vouched ; other items can be verified by reference to persons who have obtained judgments against the bankrupt. The cause of the bankruptcy is a composition made long ago between the bank- rupt and his then creditors, which failed in consequence of some informality in the deed. That may be fairly considered as unavoidable loss and misfortune, and the bankrupt is_ entitled to a certificate of the first class. Mr. Commissioner Ponblanque. — There is no cash-book. The existence of a cash-book properly kept is a sine qua non for the granting of an immediate certificate. It is not sufficient that such a book may now be made up from the diary ; it ought to have been regularly kept. The acts of a G 2 84 REPORTS OF CASES 1850. trader shoiild be sucli as that he can satisfy his creditors, by ' inspection of his own books, without referring to other sources Ex pwrte Caetee, of information, such as judgments. Whatever may be the Caetbk. usage of solicitors as to keeping their professional accounts, if they enter into trade, and render themselves liable to the bankrupt laws, they must take care that their accounts of the whole of their estate and effects, from whatever source derived, shall be such as to satisfy their creditors and this Court, if they should have the misfortune to come here, that they have made a full disclosure of their estate. As to the causes of the bankruptcy, the bankrupt was insolvent long ago. The effect of the old composition is, that the old debts have been paid at the expense of the new creditors. The bankrupt's professional experience ought to have shown him the result of his conduct. I cannot consider that the bankruptcy has been caused wholly by unavoidable loss and misfortune. The cer- . tificate must be suspended for three months ; to be, at the expiration of that time, of the second class. (Before Mr. Commissioner HoLROTD.) Re St. Albans Bank. Eelation be- X HE facts appear in the judgment. tween banker Duties rf'"^'"' JUDGMENT. Ge^ral ' ri ^'' Co'^^issioner HoLROYD. — I have now to give judg- cipiesasto ment in the case of Edward Gibson, and also in the case the manner in „ „ cij. i i ■ r. which transa,000l. I told him, and he knew well, I had no means of paying any part of this sum, and I Thomas e. had not, in fact, at that time any property whatever. In addition to the sum of 4,000^. due for salaries, there was a sum of 2,500/. for arrears of rent. I told Beale this, and he told me Mr. Ghappell, his attorney, had seen Mr. Surnam, the solicitor for the lessors of the theatre, and had made an arrangement with him for the payment of the arrears of rent weekly. I left no money either with Beale or William Hugh Fenn, the treasurer of the theatre, to pay any of these sums, because I had no money. I now recollect, and wish to state by way of explanation, that the conyersation between me and Beale as to the debts and engagements of the theatre, took place on Sunday, the 15th of April, at Mirart's Hotel. I know it was on Sunday, the 15th of April, because on the morning of that day Mr. Appleby, my solicitor, and Mr. Fenn, the treasurer of the theatre, called upon me at Mivart's, to confer upon the state of my affairs, and afterwards, at my suggestion, Beale was fetched from his house, Finchley-road, to Mivart's Hotel, where this conversation took place, and he then agreed to enter into the arrangement which was after- wards carried out by the deed of the 21st of April. I saw him daUy between the 15th of April and the 21st of April, and we frequently conversed upon my intended departure from England, and Ghappell, his solicitor, also knew it. No time for my return was mentioned, either by them or by me ; in fact, my return was quite uncertain. I also, on the 1st of May, 1849, executed, in conjunction with Mr. Henry Arthur Webster, to Mr. Thomas Frederick Beale, a conveyance of all interest I had in the Willow Bank estate, and in the furniture, fixtures, and effects there, to secure a sum of 7,000/. This deed was prepared by Mr. Ghappell, and executed by Mr. Webster and me at Brussels. When Mr. Webster executed the deed, he received, I believe, 250/. from Mr. Appleby, who brought the deed over ; but I received nothing, nor have 128 REPORTS OF CASES 1850. I since received anything from Beale. I believe it was also agreed that Webster should, in addition to the sum of 250/., Thomas E. receive from Beale 151. monthly, during the time Beale kept Delafield. ^pg^ ^j^g theatre. When I had executed this deed of the 1st of May, 1849, I had no property whatever left, and this Beale knew perfectly well, for I had had many conversations with him on the state of my affairs before the 21st of April. I was, in fact, entirely ruined at the end of the season 1848. My balance at my banker's was quite exhausted, and I began the opera season of 1849 by a loan of 2,000Z. from my bankers." The folly of entering upon such an undertaking without any experience to guide him, is obvious. The result was a balance of loss on the season of 1848 of 34,756?., and on the season of 1849 of 25,455?. Even this gigantic undertaking did not satiate his passion for ventures connected with music and theatrical entertainments, for, in the early part of 1848, he also undertook to make advances to Mr. Charles Mathews to carry on the Lyceum on joint account. This project was soon found to be unprofitable to him, and he withdrew, after having sustained a loss of 5,312?. Pending these proceedings, he had made a present of 5,000?. to a musical acquaintance of his, Mr. Arthur Webster, with which Mr. Webster had pur- chased a villa on the banks of the Thames, called Willow Bank, and as it was thought desirable that the villa should be improved, he agreed to assist Mr. Webster in repairing or rather rebuilding and decorating it. For this he ultimately paid about 8,300?. The result of all is told by himself in these words : — " I was, in fact, entirely ruined at the end of the season 1848. My balance at my banker's was quite exhausted, and I began the opera season of 1849 by a loan of 2,000?. from my bankers." As the season advanced, his distress for money increased, and in April Beale was obliged to advance 1,000?. to pay Grisi and Mario. On the 15th or 22nd, Beale and the bankrupt met, and an account was pro- duced, by which it appeared that 4,000?. was then due for IN BANKRUPTCY. 129 salaries ; and in order to induce Beale to carry on the theatre, 1850. the bankrupt, on the 22nd of April, executed a deed, prepared by Mr. ChappeU, Beale's solicitor, whereby he assigned all his Thomas e. interest in the theatre, theatrical properties, and debts due to elapield. him for subscriptions, to Beale, to cover such advances as he had made or might make to carry on the theatre, not exceed- ing 7,000Z. ; and he himself retired to Brussels, to avoid arrest. On the 1st of May following he became party to another deed, by which Mr. Webster conveyed Willow Bank and the property there to Mr. Beale also, to secure 7,000/. ; and on the 12th of July following the fiat issued. Such are the circumstances of this lamentable case ; and it is now con- tended that I ought either to refuse the bankrupt's certificate altogether, or postpone the allowance of it for some time, or annex the condition that the bankrupt shall pay 10s. in the pound to his creditors out of any property which may here- after come into his possession. I do not think, however, that I ought to adopt any one of these courses. The first charge made against the bankrupt, is that his expenditure was reck- less. But what evidence is there to support this charge ? I have certainly heard, out of court, that a very extravagant style of living was indulged in at Willow Bank ; but WiUow Bank belonged to Mr. Webster, and, for anything that appears to the contrary, the bankrupt was rather a guest there than anything else. But, whatever the fact may be, I have nothing to do with anything but what appears in evidence before me ; and all that is in evidence on the subject of reckless expendi- ture, is a statement in the balance-sheet, showing that the bankrupt's personal expenditure from November, 1845, to July, 1849, nearly four years, was 22,000/. ; from which must be deducted at least 3,000/. for college expenses prior to 1845, leaving, therefore, a personal expenditure in that period of 19,000/. only — ^less than 5,000/. a year. Now, this is not reckless expenditure in a person who had an income of above 7,000/, a year. In reference to this part of the case, allusion was made to the gift of 6,000/. to Mr. Webster, and the sub- K ISO EEPOETS OF OASES 1850. sequent expenditure of 8,300^. for his benefit. As to this; the bankrupt's excuse is, that Mr. Webster had lent him Thomas e. money to enable him to meet his early difficulties, and he also Delapibld. anticipated a marriage between Mr. Webster and a near rela- tion of his. But it is scarcely necessary to notice these expla- nations. The 6,000/. was given on the 27th of February, 1847, and on that day the bankrupt received 20,000Z. from Messrs. Combe and Co., and when he engaged to pay for the improvements at Willow Bank he had stiU 80,000/. in reserve ; and of course every person is at liberty to give away thousands out of his own money, if he chooses so far to depart from the ordinary usages of mankind. The only other charge made against the bankrupt on public grounds, was that he had made away with all his remaining property in favour of Beale, just on the eve of bankruptcy; and this charge was founded on the execution of the two deeds of the 22nd of April and the 1st of May, 1849. Now, it has always been considered by me as a very important part of my duty here, to impress on aU traders, that although they are at liberty to struggle for a living as long as there is a fair chance of success remaining, and their creditors are willing, by abstaining from pressure by suit to allow them to do so, still that they are bound, when all reasonable hope is gone and pressure by cre- ditors begins, to look their affairs steadily in the face ; and if they see no fair ground of hope, and some of their creditors will wait no longer, then to place themselves entirely in thd hands of their creditors, and, if necessary, submit to bank- ruptcy, showing no fe,vour to one creditor more than another. Prima facie, the application of this principle to the present case would require condemnation of the bankrupt, for an unfair preference of Beale ; but, upon full consideration, I am of ophuon that this is an exceptional case. First, some allowance ought to be made for the extreme youth of the bankrupt ; some for the circumstance that he could hardly be deemed a trader ; some for the deception of which he has been made the victim, and some for the greatness of the ruin IN BANKRUPTCY. 131 whicli has befallen liim, which of course must operate in 1850. itself as severe punishment. But I have another difficulty ~~~ in dealing with this part of the case on the strict principle, Thomas e. and that is, that the assignee has thought it best to settle all questions with Mr. Beale, by accepting from him 1,000/. in satisfaction of all claims, and hence there has not been that full investigation of the facts connected with the execution of the two deeds, which would be requisite to enable me to form a judicial opinion on the merits of the transactions. An obvious excuse, however, offers itself for the execution of the deed of the 22nd of April ; that April was the very com- mencement of the Covent-garden Opera season, and the bankrupt might have thought, that, in inducing Beale to famish funds to go on with, he was doing the best he could for the creditors, whose immediate subsistence and ultimate payment depended on the theatre being kept open. With regard to the deed of the 1st of May, it seems that the bank- rupt was, in fact, not a conveying party ; it related to Mr. Webster's property, and it was only executed by the bank- rupt in order that any subsequent purchaser under Beale might be better satisfied. Under these circumstances, and having regard to all these considerations, I do not feel myself in a condition to pronounce judicially that the cer- tificate ought to be postponed in respect of the alleged unfair disposition of property on the eve of bankruptcy. It remains to consider the private complaint of the assignee. He was a college friend, three or four years older than the bankrupt. In March, 1846, being then, it must be presumed, well acquainted with his young friend's carelessness about money, and his unfitness to be trusted with it, he thought proper to lend him 4,600?., to be repaid at the option of either party, on twelve months' notice being given. In February, 1848, he or his friends commenced an action to recover the money imme- diately, with interest. The bankrupt paid the interest ; but, as to the principal, he declined paying at that time, on the ground that he was entitled to twelve months' notice. The 132 REPORTS OF CASES 1850. assignee, knowing that the defence was right in point of law, submitted, gave immediate notice, and then renewed his Thomas E. action in February, 1849. Meanwhile, the bankrupt had Delameld. j^yoiyg^ himself in the Opera speculation, and was, in fact, utterly ruined. Now, is there anything in these circum- stances that should deprive the bankrupt of his certificate ? I think not. The defence he made was justifiable at the time. The lender had agreed that repayment should not be made except after twelve months' notice, and notice had not been Semble— That given. But then it is insisted that I ought, in granting the not annex the certificate, to attach a condition, that the bankrupt shall pay condition that j()g_ jjj ^j^g poun,j on his dobts out of futurc assets; and a the bankrupt -r ' shall make decision Something to that effect in Lord Huntingtower's payments out ., ^ \ t t , -i ,^ of his future case was Cited to me. («) 1 do not know the exact particu- he*hadIoex- ^^^^ °^ *^^* °^^- ^ "^V ^^^o^ t^^* ^^^ case was very pectations of peculiar : but I confess I have no inclination to attach such future estate when the debts condition to a certificate in any case. I refused to do so in traoted. Jullien's. The world of industry in which we live is one in which every man not living on accumulations is struggling for a subsistence. In that struggle it is difficult enough for any one to win his way, even with character clear and some- thing to begin with. "What, then, may be expected to be the fate of one who not only begins with nothing, but is weighed down by the stain of bankruptcy, and by an unpaid debt of 10s. in the pound on 33,000/. ? I see nothing for a person so burdened, but to lie down in hopeless despair, and abandon all fature exertion. Were the faults of this bankrupt far greater than they are, I woidd not condemn him to such a fate. It may be said that tliis bankrupt has rich relations. Perhaps he has. But if it were true, this argument is one (a) Lord Himtingtower was at certificates of bankrupts exercising the time of his bankruptcy entitled some business dependent on pro- in expectancy to property of consi- fessional skill, the same as to au- derable value, and obtained credit thors, on the ground that credit in consequence of such expectancy. was given to them in expectation of Conditions to pay out of future the income that might arise from estate have been annexed to the their skill or attainments'. IN BANKRUPTCY. 133 which will never weigh with me. I will never be a party to 1850. the establishing of any such doctrine as that rich relations ' are under any obligation to pay the debts of extravagant Thomas E. connections. A contrary doctrine is a far more wholesome one. It is far better to lay it down that no creditor shall have any means of pressure, direct or indirect, upon rich relations, and thus check the giving credit to the young and foolish. It is the too great prevalence of this credit, which, in the long run, leads to the establishment of laws, which, intended to check the unwholesome credit only, which is given to the idle, such as that given in Lord Hunting- tower's case, and again in this, have a tendency to impede that wholesome credit, which, by enabling struggling industry to exercise its calling, is the source of public wealth. And for whose benefit am I to impose this burden ? — for that of the assignee, or for that of the general body of creditors? If for the assignee, I answer, that he knew at the time he lent the money that he was lending to a spendthrift ; that the money was to meet past or provide for future extravagance. Why should the law go out of its way to aid such lenders ? They are public enemies. They foster extravagance, encou- rage idleness, and disturb the happiness of families. Even those who advance money to enable others to educate them- selves or go into business, must submit to the loss of what they have lent, if circumstances turn out unfavourable ; and if this be the fate of those who advance money for praiseworthy purposes, why should it not be the fate of those who advance money to supply extravagance 1 Surely the loss of what has been so lent is a not inappropriate punishment for persons who thus interfere between the young and their natural advisers and protectors. But it may be said that I ought to impose this condition for the benefit of the other creditors. To that I answer, that I do not beheve that there is even one who wishes it. I have now been engaged twenty-five years in administering the law of bankruptcy, and in that time I have observed that the most marked feature in the conduct 134 1850. Re Thomas E. Dblambld. REPORTS OF CASES of creditors, as a body, towards debtors, is an rmwillingnesa to press harshly on the fallen ; and I doubt not that that is the feeling which pervades the body of creditors in this case. At aU events, not one has appeared to make the slightest personal complaint against the bankrupt. But, if a contrary feeling did prevail, I should not yield to it ; for I look upon the general body of creditors, in this case, as co-speculators, with the bankrupt ; and as the speculation has been a total failure, and he the greatest sufferer, all ought to bear their share of the misfortune, without refusing. On the whole, I think, upon full consideration of aU the circumstances, that I shall best discharge my public duty by granting the bankrupt a common certificate, without attaching any condition to it. I hope that the terrible lesson he has received may be of use to biTTi in after-life. (Before Mr. Commissioner Holeoyd.) Re A Trader-debtor Summons. Disputing IjtFCAS, for the trader summoned. — We put in a deed of ''S* '■ ^"*^"™' composition made between the trader against whom the sum- Practice, mons is issued and his creditors, of whom the person who time for dis- issued this summous is one, whereby, for the considerations of tSfsum- ^ ' therein mentioned, it is covenanted and agreed that the credi- tors shall not molest the trader in respect of their debts for a certain period, which has not yet elapsed. None of the con- Jtme Wth. momng cre- ditor is at the adjudication. cient tiiat the siderations have failed ; the creditors are therefore now barred onginai notice ^^^^ taking; such proceedings as the present. and particulars o r o r of demand filed debt in equity to Support the summons. The notice requiring though the' payment, and the particulars of demand, served on the trader, thftriris"" are informal- irregular. Where the debt is disputable, the practice is for the trader summoned to file an affidavit that he has a good defence on the merits. There is no -they are not signed by the summoning creditor. IN BANKRUPTCY. 186 A Solicitor, contra. — The notice and particulars which have been served are copies ; the originals, which are on the file, are regular. Mr. Commissioner Hoiuotd. — The notice and particulars on the file seem to be regular ; — that is sufficient. I have no jurisdiction to try whether the debt be good or not, till the adjudication of that proceeding shall hereafter take place. 1850. Re A Tkadek- Debtor Summons. Lucas then put in an affidavit that there was a good de- fence on the inerits to the summoning creditor's debt. The Court, having read the affidavit, refused an applica- tion that the trader should execute a bond. (Before Mr. Commissioner Fonblanque.) Be TiDMARSH. X HE banlirupt was heard on his application for his certifi- cate on the 22nd of May, when the farther consideration of his application was adjourned, in order to give him an opportunity of producing one James, whom he alleged to have been his intended partner, and on whose promise to advance a sum of money, he, the bankrupt, had commenced business. This day the bankrupt did not appear. Wednesday, Jime 26 ' judication ; and if within such time the bankrupt shall show, to the satis&ction of the Court, the invalidity of the adju- dication, the same shall be annulled : Held, that the meaning of this provision is, that if the party shall, within the appointed number of days, have brought the case before the Court, and done what was in his power to obtain a hearing, the Court shall entertain it, and if satisfied, ultimately, of the invalidity of the adjudication, shall thereupon annul it, although circumstances, not arising from the deiault of the party, should have occurred to prevent the Court from actually giving judgment, or even beginning to hear the case, within the period prescribed by the statute. The provisions of the statute are satisfied if the party, within fourteen days, appears and presents himself to the Court, and is ready to show cause, and is only prevented by an accident not under his control. 164 BEPOETS OF CASES 1850. annulled; which implies (as is contended) that unless the ~ insufficiency is shown within the fourteen days, it is afterwards M. EoBEETs. too late for the Court to annul. And, as regards the present case, it is insisted that the fourteen days expired on the 5th September, and that it has not yet been shown to the Court that the adjudication is insufficient, and that no announce- ment even has been made of showing this to the Court ; for although, on the Srd of September, evidence against the adjudication was taken before the Registrar, this is no showing cause within the Act of Parliament, the Registrar being excluded by the 27th section from the power to hear a disputed adjudication, and all showing of cause before him being, con- sequently, null and void ; so that the result is (as contended) that it is now too late for the Court to annul the present adjudication. But, after carefully examining the provision in question, and reflecting on its real nature and object, I am of opinion that this is one of those cases in which, by adhering servilely to the words of an Act, we should depart from its meaning. Already it has been decided in this court, and, I believe, by other commissioners, that the provision in question does not require cause to be fully shown against the adjudica- tion within the fourteen days ; and that it is sufficient that the party begins to show cause within the fourteen days, although the case is then adjourned, and is not, in fact, con- cluded till long after the fourteen days have expired. And this construction (which has not, I think, been questioned) must be supposed consonant with the intention of the Legis- lature ; for the greatest inconvenience would ensue if, in a case involving much evidence, a discussion is interrupted by illness of parties, or the like, it should be absolutely necessary to bring the proceedings to a close, and even to obtain the Court's judgment, within a short- period of this discussion. And, on the other hand, no reason of public policy can be shown for prescribing under such cases so inflexible a limit. But, if so, it follows that the words of the provision are not to be literally understood, but admit of a certain latitude of interpretation ; IN BANKRUPTCY. 165 and it seems to me, upon the same principle, we may and 1850. ought to advance a step still further in the same course of ~~ liberal construction, and to hold the Act satisfied if the party, ¥■■ Eobekts. within fourteen days, appears, and presents himself to the Court, and is ready to show cause, and is only prevented by an accident not under his control, such as the illness of the com- missioner. And such, I think, is the fair effect of what took place on the 3rd September ; and it ought, in my opinion, to be so entered on the file ; for the person adjudged bankrupt then came, by her soUcitor, before the Court (that is to say, before Mr. Serjeant Ludlow, and not before the Registrar, for the Registrar can act only as deputy to the Commissioner, and in the event of the Commissioner's absence), and was ready with her witnesses ; and her soUcitor must be understood to have presented himself for showing cause in court, had the Commissioner happened to be there. Nor does it make any difference that, in fact, the parties did not expect the Com- missioner to be able to attend, and had agreed that the case should be adjourned over to the 17th; for still, if the Commissioner had unexpectedly appeared, the actual showing of cause might have taken place, and would presumedly have been begun, pro forma, at least, so as to introduce the prior adjournment agreed upon as an adjournment made by order of the Commissioner. The effect of the decision is, that I consider the provision, that the party shall be allowed so many days to show cause, and that the adjudication shall be annulled, if within such time he shows its invahdity to the satisfaction of the Court, as equivalent only to a provision that, if the party shall, within the number of days, have brought the case before the Court, and done what was in his power to obtain a hearing, the Court shall entertain it, and if satisfied, ulti- mately, of the invalidity of the adjudication, shall annul it, though circumstances, not imputable to the party, should have occurred to prevent the Court firom actually giving judgment, or even actually beginning to hear the case within that period of time. And it will be found, I think, that there is sufficient 166 REPORTS OF CASES 1850. authority in the books " for taking so much liberty as this with the words of an Act of Parliament (even an Act of modem M. EoBBBTs. date), in order to let in that meaning to which reason and manifest convenience are found to point." I may add that I think there is no reason to question the validity of the adjournment that took place on the 3rd of September ; for although the Registrar has no authority to hear, he has authority, for anything I see, to act contrary, to adjourn a hearing ; but, on the other hand, unless cause can be shown to the contrary, I shall hold that no use can be made of the examinations taken before the Registrar, which appear to me to have been in the nature of a hearing, but a hearing coram nonjudice. Indeed, the learned officer himself, seems to have considered their regularity doubtful, as he took them pro- visionally only, and with express reference to the possibility that the Commissioner might order the witnesses to attend again. Stone then suggested that the case should be adjourned till such time as might now be agreed upon. His Honour concurred, and intimated that it would throw more light on the case, if the Registrar supported the view he (the learned Commissioner) had taken of the case, as to the examinations being taken de novo, that an entry should be made on the file, that, on the 3rd of September, Mr. Keams, as solicitor to the alleged bankrupt, appeared to show cause against the adjudication, with his witnesses, Mr. Miller being also present, on the part of the agent of the petitioning creditor, when, in consequence of the Commissioner not being able to attend, it was agreed that an adjournment should take place. :n bankruptcy. 167 1850. (Before Mr. Commissioner GouLBUEir.) Ex parte Cltjtton and Another, re Nash and Nealb. Satwday Decemher 1th. JL HE petition stated, that on Saturday, the 22nd day of Money was June, 1850, the petitioners delivered to Thomas Bowring, i,ank, through as the agent of the petitioners, a sum of 1,179?. 6s. 3d., con- ta^^o^ngato^ sisting partly of notes of the Bank of England and country day evening ^ftsr office notes, partly oi cheques on country bankers, and partly of hours. On the gold, silver, and copper, with directions to lodge the money on™of fte""^ at the hank of Messrs. Nash and Neale, to the account of the prtners of the bank made a petitioners. That at eight o'clock in the evening of the declaration of 22nd day of June, Thomas Bowring took the money to the the abseSeand banking-house of Messrs. Nash and Neale, but that the bank ^*out the o ' Jtnowledge oi had been closed since five o'clock in the afternoon, and there- bis partner. .,, The bank never tore the money could not be deposited m the bank, or any again opened entry made thereof in the bank books. That Thomas Bow- and^^e'^ther ring thereupon went to the private door of the banking-house, partner con- ° . . '^ & ' curred in allow- and inquired for Thomas Johnson, the manager of the bank, ing it to remain and who resided in the house ; and that Thomas Bowring partners were was informed that Thomas Johnson was not at home, but subsequently adjudicated that he should be sent for ; and thereupon Thomas Bowring bankrupts : entered the house, and shortly afterwards Thomas Johnson the money so returned home. That Thomas Bowring then placed the bank- paas°ed*to the notes, cheques, and cash in the hands of Thomas Johnson, assignees. who counted them and made a list thereof, and signed and delivered to Thomas Bowring a receipt for the same, dated as of the following Monday, 24th of June, 1850. That the bank-notes, cheques, and cash were not entered by Thomas Johnson in any of the bank books, or in any way mixed with the bank moneys, but were placed by him separate and apart in a bag containing the bank-notes, cheques, and cash only. That the bank was usually opened at nine o'clock in the morning, but that on Monday, the 24th of June, 1850, the bank was not opened ; but that before nine o'clock of the re Nash&Neale. 168 BEPORTS OF CASBS 1850. morning of that day a notice was affixed to the door of the banking-house, purporting to inform the public that the bank Glutton, would not again be opened. That on Monday, the 24th of June, the petitioner, Robert Glutton, having been informed, as the fact was, that from the time of Thomas Bowring leav- ing the money at the banking-house the bank had not been opened, and that the money so left at the banking-house had not been received by the bankers, applied to Thomas Johnson to return to him the bank-notes, cheques, and cash, as being the property of your petitioners, but that Thomas Johnson declined so to do without the direction of the bankers ; and that Mr. Kelly, the sohcitor of Joseph Nash, who was present at the interview, informed your petitioner, Robert Glutton, that the bank-notes, cheques, and drafts could not be re- turned at present, but that they would be in safe custody, and that he, Mr. Kelly, had earmarked the bag in which the same were contained. That the bankers, by closing the bank on Monday, the 24th day of June, 1850, committed an act of bankruptcy, and thereby became bankrupts ; and that on the 27th day of the same month they were adjudged bankrupts, and "William Pennell, Esq., was appointed the official assignee of their estate and effects ; and that William Pennell took possession of the effects of the bankers, and also wrongfully took possession of the bag containing the bank-notes, cheques, and cash belonging to the petitioners. That the cheques contained in the bag amounted together to the sum of 820/. 14s. ; and that two of the cheques, amounting together to the sum of 60/. 12s. 7d., were on the bank of Messrs. Nash and Neale, but that the rest of the cheques, amounting to the sum of 760/. Is. 5d., were drawn on various other country banks ; and that the notes drawn on country banks, contained in the bag, amounted to the sum of 100/. ; and that part of such notes, to the amount of 40/., were notes of Messrs. Nash and Neale, and the residue of the notes, amounting to the sum of 60/., were the notes of other country banks. That William Pennell, the official assignee, in order IN BANKRUPTCY. lb"9 to provide against any loss by the failure of the country 1850. banks, immediately procured the cheques, except those drawn ' on Messrs. Nash and Neale, and also the notes on country CLniioN, banks, excepting those of Messrs. Nash and Neale, to be Nash&Neale. cashed and received,' and has now in his hands the proceeds arising from the cheques and notes, which amount, after deducting a commission of \l. 7s. 6d., to 818Z. 13s. lid. That the official assignee has also now in his hands the cheques on the bank of Messrs. Nash and Neale, amounting to 60/. 12s. 7d., and the notes of Messrs. Nash and Neale, amounting to 40/., the Bank of England notes to the amount of 90/., and the gold, silver, and copper, to the amount of 168/. lis. 3d. It was in evidence that both the bankrupts were very aged men, and unable to attend constantly to the business of the bank, and that the whole management of the business was intrusted to Johnson, who was in the habit of receiving deposits after office-hours, to accommodate cus- tomei-s ; that the Messrs. Glutton were in the habit of making deposits after the bank had closed. Johnson, when examined, swore that at the time of the deposit in question he was acting as manager of the bank, and that he had no specific instructions as to this transaction, but acted according to his discretion and usual custom ; that the receipt he gave was in the usual form, but was dated as of Monday, and not Satur- day, and was for cash, which would have gone immediately to the credit of the petitioners ; that he was not aware that Nash had made the declaration, or contemplated bankruptcy, and that he did not think it probable that the bank would close on the following Monday. Lewin, in support of the petition.— The receipt of the deposit , by the bankrupts through their agent, at a time when bank- ruptcy was not only inevitable, but actually contemplated and determined on by one of the firm, amounts to a legal fraud, — a circumstance which will take the case out of the general rule in bankruptcy. {Sadler v. Belcher, 2 Moo. & Rob. 489, and Threlwal v. Giles, there cited.) Here money was deli- N 170 REPOETS OF CASES 1850. vered under a mistake as to the solvency of the person re- ~- cemng it, and it might haye been recovered from the CLDTTOir, bankrupt but for the bankruptcy ; but the bankruptcy does Nash&Nbale. 110* ^^^^ ^^^y *^^ "g^*^ °^ *^® depositors ; the assignees are only in the same position as to them as the bankrupts were. The deposit with Johnson was irregular, and was not a pay- ment into the bank qua bank. The receipt by Johnson only amounts to an agency ; and if he were our agent, the receipt from him by the bankrupts would be a fraud ; but he was, in fact, an agent for both parties ; like an auctioneer who has received a deposit in respect of a sale, he is the agent for the vendor or the vendee, according as to whether the contract is completed or not ; and in this case the agency will be deter- mined by the result, viz., whether the bank would open again for business or not ; for the opening of the bank so as to en- able the depositor to draw, is the consideration on which the contract between the banker and customer is founded (Ex parte McGal, 2 Rose, 376), which consideration has failed, and Johnson remains our agent ; and considering him as such, the deposit made by him in the manner it was, was a specific deposit in trust, to be paid into the bank when the bank opened for business. This appears from the terms and date of the memorandum of receipt given by Johnson to the petitioners. Had the petitioners been aware of the facts, they might have exercised their right of stopping the money, which was in transitu from the time of the delivery on Satur- day evening till such time on Monday as the banking-house would have opened. {Ex parte Gvmningham, 3 Deac. & Oh. 58 ; Ex parte Solomons, ib. 77 ; and Ex parte Sutherland.) But if the money was received by Johnson as agent for the bank, it must be deemed a specific deposit, and not a loan, which would become part of the general assets and pass to the assignees. It appears by the memorandum, that the money was intended by both parties to be entered on the next occa- sion when the bank should re-open for business. No entry was ever made ; so that the deposit still remains in trust for IN BANKRUPTCY. 171 the petitioners. (Barthorpe v. Barthorpe, 1 B. & Or. 5 ; 1850. Toovey v. Milne, 2 B. & Aid. 683.) The money was also ~ £iX pa/rte tied up in a bag and earmarked, so that it comes under the Chitton, rule as to deposit of plate or short bills, which cannot be NiSH&NBAM. disposed of by the bank, as money paid for the usual pur- poses. But if the cash passes to the assignees, the drafts do not, — they are not cash ; being named as such does not alter their nature. Bills so entered improperly have been returned to depositors on a bankruptcy. The drafts would only become cash, if intended by the depositor so to be treated. (Giles v. Perkins, 9 East, 12 ; Thompson v. Giles, 2 B. & Or. 422.) Here they could not be treated as cash, — they were never in- tended as such. At the time of the deposit, the balance was in our favour, so that no lien can be set up against us. Bagley, counsel, for the official assignee. — There is no right of priority between persons who have made payments to a bankrupt previous to the bankruptcy, in respect of the time when such payments were made. In this case, the deposit, though made in a peculiar way, was placed with other moneys and securities belonging to the bank. The declaration of insolvency made by Nash was only conditional on Saturday night ; it was not a complete act of bankruptcy until it was filed on the following Monday ; nor could it affect Neale, who was absent, and was not aware of what had taken place ; so that there was no act of bankruptcy on his part till he had concurred in the closing of the shop on Monday. The ques- tion now is, do the facts take this case out of the general rule that payments made previous to bankruptcy pass to the assignees ? Here, to have repaid Messrs. Glutton would have been a fraudulent preference. It was relied on by the other side, 1st, that it was a payment on the eve of bankruptcy ; 2ndly, that it was after office-hours, and not entered ; and, Srdly, that it was a specific deposit. As to the first point, bankruptcy is the line drawn by law as to the time when con- tracts may be made by a person who afterwards becomes n2 re Nash&Neale. 172 REPOKTS OF CASES 1850/ bankrupt. Proximity of bankruptcy does not alter the law up to the moment of bankruptcy : till then, a trader may do Glutton, anything he might have done at any time before. As to the payment being made out of office-hours, it has been shown that such a mode of payment was usual in the bank, and that the petitioners were in the habit of making deposits late in the evening to suit their own convenience, and that such deposits were treated by both parties as if they had been regularly made. The entry in books is only for the information of the bankers, and does not bind customers. Assume that a banker made no entries, would a customer be precluded from his remedy for dishonour of his cheques, &c. ? Different banks keep their books in different ways : in the Bank of England, cheques paid one hour may be drawn for the next. Entries are for the purpose of tracing deposits. The rights of parties are not to be affected by the mode in which it is entered, but by the contract, which, in this case, is the common contract, between banker and customer, which only constitutes a loan, with the provision that the banker must honour cheques. The modem authorities support this view. {Pott V. Clegg, 16 M. & W. 321.) The customer's deposit is a debt which may be barred by the Statute of Limitations ; which would not be so if it were a trust. The receipt was in the regular form. The words, to he accounted for on demand, and for Joseph Nash and Thomas Neale, preceding the sig- nature, are engraved ; so that the deposit might be drawn for immediately. Is this an agency by Johnson, as suggested ? If so, the remedy ought to have been against Johnson ; there would be no privity on the part of the assignees. The ques- tion is, if the bankers received the deposit, and placed it in the till, or applied it to their own use, would they be liable for an action ? Would they be in the same position as if they had so applied a specific chattel ? To support such an argu- ment, it should be shown that bankers may not use money deposited with them, or use it in the common way for their profit. Were the bankrupts parties before Monday morning ? IN BANKRUPTCY. 173 The receipt was dated for Monday, because the books had been 1850. put aside, the houi-s of business having expired, the entry ' " could not have been made sooner than Monday. If the receipt Glutton, had been dated on Saturday evening, and an entry made nash&Nbaie. afterwards, it would have caused confusion. As to the ques- tion of interest not running till Monday, the money could not be used in business before ; and if there had been a contract for interest, it would have been agreed that the interest would only run from the time when the money could have been apphed to business purposes ; but that question does not occur now. The petitioners demanded the money from the agent of the bank after it had arrived at its destination ; so there can be no stoppage in transitu. Sadler v. Belcher was at Nisi Prius, and was never carried further, and was decided on the ground of fraud. There the partners had resolved to stop before the deposit was received, — the act of bankruptcy had commenced ; but here, though Nash had determined to commit an act of bankruptcy, that did not affect Neale. This is a case of a firm of which we are assignees, and not of Nash alone. It cannot be said that the act of bankruptcy of one could have operated against Neale. The cases cited on the other side establish no principle as to the validity of contracts up to the date of the bankruptcy. In Ex parte Cunningham, the contract was subsequent to the act of bankruptcy. This is not a specific deposit, and therefore demandable from the assignees under the principle relied on by the other side ; — there has been no evidence to support their view. The receipt of the deposit by Johnson was in conformity with the general custom of the bank ; nothing passed on this occasion different from what had passed on previous similar occasions. This is not a contract founded on the power to draw, — but this is simply a loan, and the right to draw is a conventional arrange- ment as to the mode of payment. Cheques are usually con- sidered as cash, though it is otherwise as to bills not, due. Here the cheques would have been entered on the debit side, and so treated as cash. -(^'ic parte /Saryewi, I Rose,.153.) 174 EEPOETS OF CASES 1850. Whether short bills are deposited for a specific purpose, or as cash, depends on the understanding between the parties at the Glutton, time of deposit ; and, once treated as cash by drawing for the Nash&Nealb. amount, they cannot be treated as anything else. {Ess parte Pease, 1 Rose, 238.) Here there was a power to draw for the whole ; so that the distinction between the cash part of the deposit and the drafts must fail. Thompson v. Giles, and Giles V. Perkins, support this view. Lewin, in reply. JUDGMENT. In this case it has been shown to me that Nash had, on the night in question, determined, in a certain event, to commit an act of bankruptcy ; but that determination was tmtnown to Neale, who, it appears, actually resisted any proposition as to bankruptcy until he found the house closed on the Monday morning. The act of bankruptcy against him was permitting the house to remain closed ; and, under the circumstances, it cannot be said that such an act can have any relation to the conversation which took place on Saturday evening in his absence. Moreover, the declaration of insolvency was not a complete act of bankruptcy till filed, and that did not take place till the Monday ; so that it cannot be established that the firm became bankrupt till the latter day, although one of the partners resolved on bankruptcy previously ; for such a determination by one partner will not bind the firm. In Sadler v. Belcher, and the case there cited, it had been agreed on by all the partners that the bank should not be re-opened. Assuming this deposit to be cash, it would pass to the assig- nees ; and it appears by the receipt, as well as by the custom of dealing between the parties, that this deposit was intended to be taken to be cash to be accounted for on demand ; and this takes the case out of the doctrine in WhitmoreY. Wells; for there no receipt was given. It is true no entry was made in the bank books ; but that is to be accounted for by the lateness of the hour, and the books having been closed for that IN BANKRUPTCY. 175 day. To have made an entry after the books were balanced, ] 850. would have created confusion. I do not think that any agency 11 Expm-te on the part of Johnson for the petitioners has been esta- Glutton, blished. He acted only as he had been in the habit of doing nash&Nbale. on other occasions for the convenience of the petitioners, on which occasions the deposits were considered as made in the regular way, and became immediately part of the funds belonging to the bank. In Threlwal v. Giles, the manager was aware that the bank was about to stop. In Ex parte Cunningham, the deposits were made at a branch bank, sub- sequent to the stoppage of the principal bank ; so that this case differs from both those cases. That there is any contract founded on the receipt being post-dated, would be an inference not supported by the circumstances ; and I think no fraud has been made out ; so that the case resolves itself into this, — that the deposit was paid to and received by the manager of the bank in the usual course of business previous to the bankruptcy, and becomes assets of the bank, and as such may be proved for, but cannot be recovered. Petition dismissed, (a) (Before Mr. CommisBioner Fonblanque.) Be Nov. 20th. A. BILL of exchange was drawn by A., accepted by B., and ^ disiionora-e°d indorsed, among others, by C, and ultimately came into the biUofexc^nge hands of D. The bill was dishonoured at maturity, and duly blishapetition- ,,^„., , . . n f 1 L n ™g creditor's protested ; but D. failed to give any notice of dishonour to L., debt against an indorser who has had (a) There was an appeal from this but the matter was arranged between ^g notice of decision to Vice-Chancellor Knight the parties, and no trial took place, dishonour Bruce, who directed a trial at law; through the laches of the holder. Where the act of bankruptcy was foiling to enter into a bond to secure petitioning credi- tor's debt, and the debt is insufficient, the act of bankruptcy is also insufficient. 176 EEPOETS OF CASES 1850. and a considerable period elapsed between the dishonour of the " bill and the present time. A petition for adjudication in bankruptcy was filed against C, founded on his failing to find securities under sec. 80, but the petitioning creditor failed to establish his debt. D. now sought to set up a substituted petitioning creditor's debt against C. under sec. 76. Bagley, counsel, for petitioning creditor. — We rely on the original consideration. Lawrance, solicitor, controi, cited Alder son v. Langdale, 3 Bam. & Adol. Mr. Commissioner Fonblanque. — Where there has been laches by the holder in failing to give notice of dishonour to indorsers of a bill of exchange, it has been held that the holder cannot revert to the original consideration against the indorser ; and the indorser has been discharged from his liability. This is the present case. Adjudication must be annulled. Lawrance, solicitor, asked that the memorandum on the proceedings should also state that the act of bankruptcy was insufiicient. The Commissioner.— It is rather late to make this appli- cation ; it should have been made as soon as the original petitioning creditor's debt failed ; for the act of bankruptcy (the not executing a bond to the party summoning as a creditor) failed as soon as it was established that there was no debt. The memorandum was inserted. IN BANKRUPTCY. 177 1850. Re PiGGOT. Friday, T November 1st. HE bankrupt had absconded. Allowance to . bankrupts This was an application for an allowance for the mainte- family, nance of the bankrupt's family. Mr. Commissioner Fonblanqtje. — Where the bankrupt has absconded, the Court has no jurisdiction to make the order. Ex parte Grey, re Grey. Navemier 6th. iHE bankrupt applied for his certificate. Certificate. Notice of op- position neces- Norton, solicitor, for creditors, opposed. ^^' Linklater, solicitor, for bankrupt. — The^ creditors have given no notice of their intention to oppose. Norton. — There may be circumstances under which notice would not be required. In this case, there is an] agreement between us and the assignees, which has not yet been carried into effect ; we were induced to refrain from giving notice by the hopes that the agreement would have been completed ; under such circumstances, we are entitled to be heard in oppo- sition, notwithstanding that we have not given notice. Mr. Commissioner Fonblanqub. — The statute requires that the bankrupt should have notice'of opposition to his certificate. If you had shown that yoii had been led to refrain from giving notice by fraud or- misrepresentation on behalf of the bank- rupt, I might have heard you : but his right, under the statute, to have notice, is not to be taken away by the acts of other people. 178 EEPOKTS OF CASES 1850. (Before Mr. CommiBsioner Holbotd.) November. Ex parte Watson, re Wtat and Thompson. lomSnt'to'' Previous to the fiat, the bankmpts were jointly and separate estate severally indebted to one Adams, in a sum on their joint and after payment of dividends— Separate bond, and joint and separate bills of exchange. The A joint ore- Separate estate of Thompson became the subject of a suit in whohad^r^d Chancery, entitled Wyat v. Fuller, and was supposed to be his debt against incumbered to the full amount. Adams therefore made his the joint estate „.,.. ., , .,,. , when in igno- prool agamst the jomt estate, and subsequently received divi- Btate of the^ dends thereunder. By a decree in the suit of Wi/at v. Fuller, accounts (they ^jje charges Supposed to exist on the estate of Wyat were dis- ject of a suit allowed, and the estate now proves to be of considerable value. and* having Adams, who has since died, appointed Watson his executor. dendl^'war ^^^^ ^^^ *^® petition of Watson, praying to be permitted aUowed to to abandon his proof against the joint estate, and upon re- abandon his _ , . proof against payment by him of the dividends received, to be allowed to este,te°' and, V^°^^ against the separate estate of Wyat. upon repaying the dividends, to prove against Daniels, for petitioner. — The debt was, in fact, the separate estate. ^ ^^bt of Thompson. At the time of original proof we had no choice, being in ignorance of the state of affairs ; the separate estate was then worth nothing, it has since become valuable. (Be M'Kenzie, 1 Buck. 7 ; Ex parte Masson, 1 Rose.) There has been no conclusive election, because it was impos- sible for us to exercise a free judgment and to foresee that the separate estate would become valuable under the then cir- cumstances. Adams has abeady proved in respect of another debt, therefore he is not now barred by the certificate. Stevens, for assignees. — Special circumstances must be ad- duced to show that election is not conclusive. There must be ignorance of law or material facts. There was here a proof against joint estate and receipt of dividends. There has been a lapse of twenty years since proof, and there has not been such IN BANKRUPTCY. 179 ignorance as would enable the Court to transfer the proof. The only creditor who could have shown this fact has died. Adams's signature of the certificate in respect of joint debts bars him, unless special circumstances be shown to the con- trary. {Ex parte Husband, 2 Gl. & Jam. 4 ; Ex parte Devenport, 1 Mont. Dea. & De Gex.) Here the ground of the petition is, that the separate estate has turned out to be sufficient. But the creditor exercised his judgment once ; subsequent accidents ought not to affect his election. Proof was made with full knowledge of the law of the then facts. The certificate has been signed, a final dividend declared, and a lapse of twenty years has taken place ; the election was final. 1850. Expwrte Watson, re Wtat and Thompson. BagUy, for a creditor, on same side. Mr. Commissioner Holkotd. — The question is, has there been a deliberate election ? A man cannot be said to have made a deliberate election when he was ignorant of the state of the accounts. Here the accounts depended on the result of a Chancery suit of twenty years' standing ; therefore I am of opinion that it cannot be said that Adams made a deliberate election. I think he has a right to reconsider his election, and that, upon giving up what he has received, and interest, he is at liberty to prove again. Ex parte Smith, re Wyat and Thompson. Previous to the year I829, the brothers Douglas Thomp- son and Henry Thompson carried on business as brewers, in partnership, and in January, 1829, the agreement on which On the dissolution of the partnership between H. T. and D. T., H. T. new partnership, and with his new partners was declared a bankrupt. D. T. ihe bankruptcy, paid the debts of the old firm. Held, that D. T. was entitled to prove for a moiety of the sums paid by of the debts of the firm of H. T. and D. T. against the separate estate of H Nov. \Ztli. Proof of sol- vent partner, notwithstand- ing dissolution previous to bankruptcy, entered into a '. subsequent to him on account T. 180 REPORTS OF CASES 1850. was founded the partnersliip having expired, Henry Thomp- son agreed to sell his moiety in the business to Douglas Smhh, Thompson for the sum of 15,000/., part of which was then Wtat and P^id. At that time, the debts and credits of the firm of H. Thompson. ^^^^ j) Thompson were outstanding to a considerable amount ; Henry Thompson subsequently entered into a partnership with Wyat, and Douglas Thompson entered into partnership with Wood and Fuller. The accounts of the partnership between the brothers Thompson being in dispute, were referred to Mr. Swanston, who made his award in November, 1831, by which the sum of 608/. was declared to be due to Douglas Thompson, and 5,299/. to Henry Thompson. At the time of the award, the debts due from the firm of the brothers Thompson out- standing amounted to about 10,000/. In December, 1831, Henry Thompson and Wyat were declared bankrupts, and in December, 1832, by a decree of the Court of Chancery, in a suit for taking the accounts of the partnership of the brothers Thompson, a balance of account was found to be due to Douglas Thompson in respect of his having paid the debts of the partnership. By a decree of the Court of Chancery in the suits of Wi/at v. Fuller and Adatm v. Thompson, it was declared that there was due to Douglas Thompson out of the firm of the brothers Thompson, the sum of 4,419/. in respect of payments made by Douglas Thompson ; but as Douglas Thompson was bound to pay a moiety of the partnership debts, the amount so due is reduced to the sum of 2,209/. 18s. Smith, as the representative of Douglas Thompson, now sought to prove for that sum against the separate estate of Henry Thompson. Bagley, in support of the proof. — Mr. Swanston's award only ascertained the partnership accounts up to the period when it was made. The present claim arises out of the payment of debts then outstanding. This is the ordinary case of a sol- vent partner proving against the separate estate of his bank- rupt partner, in respect of debts paid subsequent to the bank- IN BANKRUPTCY. 181 ruptcy. (Ex parte Watson, Buck. 4!i>9 ; Ex parte Hunter, 1850. id. 552 ; Ex parte Taylor, 2 Rose, 175 ; Ex parte Ogleby, ' . id. 177.) Smith, re Wtat and Stephens, contra. — The partnership having expired previous Thompsok. to the agreement of 1st July, the rights of the parties were then determined ; and Douglas Thompson could not after that claim a lien on the partnership assets. The rule in bank- ruptcy as to the right of proof by a solvent partner depends upon his having a lien. This is a case of a joint liability, and not of suretyship, as no debts were ascertained to be due at the time of the fiat. {Ex parte Porter, 2 Mont. & Ayr. 281 .) Mr. Commissioner Holrotd. — The usual rule, that partners are sureties for each other, is not affected by Ex parte Porter. It does not seem that the rights of the parties were altered by the agreement of July. The proof must be admitted. (Before Mr. Conunissioner Fonblanque.) Be Nov. Idih. oMITH, solicitor, applied for a summons to compel the Practice, attendance of a person who had been summoned to come pUo^ionfora before the Court on a previous day, but had failed so to do. warrant to ^ " bnng a person before the Linklater, solicitor, was about to show cause against the failed to obey a annlirsition summons, the appucauon. ^^^^ ^^ ^^^^ hear the solici- . tor or agent of Mr. Commissioner Fonblanque. — The party summoned the party cannot be heard by his solicitor or agent ; he is akeady in th^pplIatL contempt. He might have sent a witness to prove that his is made, absence was caused by such a necessity as the Court would admit to be a sufficient excuse for his non-attendance ; but, in the absence of such evidence, I can hear no argument against the application. 182 REPORTS OF CASES 1850. (Before Mr. Commissioner Holeotd.) Monday, Ex parte Jardine, re Jardine. December 23rd. ^_ Breach of "'- ^-^ ^'^^ ^^ appear in the judgment. trust ; refusal of certificate ; Misappropri- LivMater, solicitor, for bankrupt. ation of trust- money on the part of a bank- J ones, solicitor, for assignees. rupt by usmg i ^ a •'5a^Wr JUDGMENT. as a trader" as Mr. Commissioner Holrotd. — This is an application by cons?de"o "thL ^^^ bankrupt for his certificate. I deferred giving judgment, question of the Jq Qj^gj. ^ make inquiry as to the particulars of a case of Ex C6rtinC£lt6. ITT T • TT parte Wakefield (not yet reported), decided by his Honour Vice-Chancellor Sir J. L. Knight Bruce, on an appeal from a decision of Mr. Commissioner Balguy. The gentleman who reports the cases in bankruptcy before the Vice-Chancellor informs me that the case of Ex parte Wakefield was decided solely upon the construction of the words "conduct as a trader," in the 198th section of the Bankrupt Law Consolida- tion Act (12 & 13 Vict. c. 106), and that the Vice-Chancellor held that the misappropriation of trust-money by the bankrupt, by using it in his own trading speculations, was not such conduct as the Legislature directed to be regarded by the words " conduct as a trader." The 256th section of the Bankrupt Law Consolidation Act was not brought under the consideration of the Vice-Chancellor in Ex parte Wakefield. The Court is required by that section of the Act to refuse or suspend the certificate, if it shall appear that the bankrupt has committed any of the offences therein enumerated : one of these offences (the third) is, — " if the bankrupt shall have contracted any of his debts by any manner of fraud." The bankrupt (Jardine) is charged with having contracted a large amount of debt by fraud ; he is further charged with misconduct in having carried on trade and recklessly contracted debts after IN BANKRUPTCY. 183 a series of defalcations and offences which rendered him 1850. amenable to the criminal law. The money in respect of „ Expa/rte which the bankrupt was found to be a defaulter, or a large Jabdinb, portion of it, was improperly used by him in his trade : if he jabdine. had not resorted to those means, he must have stopped much sooner ; and the prospect of his ability to repay the money taken by binn depended upon his trade. The criminality of the bankrupt's conduct, then, in certain transactions of a pecuniary nature, cannot be denied ; indeed, some debts originating in his misconduct have been proved, and one to a large amount claimed under the bankruptcy ; but it is urged that such misconduct was not committed by the bankrupt in his trade, or as a trader, and that, upon the authority of the case of Ex parte Wakefield, which I have before mentioned, and a previous case of E so parte Spicer, reported in the Law Times of November the 10th, 1849, and decided on the 5 & 6 Vict. c. 122, s. 39, such misconduct is not cognizable by the Court. Thus, I have to consider whether the bankrupt has committed any offence under the 256th section, and, as we have held that this enactment does not apply to offences committed before the 11th of October, 1849, from which day the Act was to commence and take effect, I must look to the time up to which the malpractices of the bankrupt extended ; but I have also to determine a point of very great and exten- sive importance : whether the Court, in reviewing the conduct of the bankrupt as a trader, under the authority given by the 198th section, is confined to the consideration of conduct in the way of having contracted any particular class of debts. This must be determined by the language of the Bankrupt Law Consolidation Act, taking the whole Act together, and considering it with reference to the previous state of the law ; and no interpretation can be admitted which is inconsistent with the language candidly understood, nor any which, though consistent with the words used, would not give them a reason- able operation. (See Coleridge, J. in Fellows v. Olai/, 4 Q. B. 316, 317.) The preamble of the Act states,, that it is 184 EEPORTS or CASES 1850. expedient to amend and consolidate the laws relating to bankrupts: and the object of the Act, like that of the former Jabddte, Consolidation Act (6 Geo. 4, c. 16), as well as of prior Jabdine. Bankrupt Acts, is, to support commercial credit, and herein to benefit creditors, to prevent fraud, and to relieve the un- fortunate trader who has followed the known rules of honesty and integrity. The Act provides that various debts and demands, whether contracted in the course of trade or not, shall be proveable under the bankruptcy ; that the Court shall have power to examine the bankrupt touching all matters relating to his trade, dealings, or estate, and any other person the Court may believe capable of giving information concerning his person, trade, dealings, or estate, or any act of bankruptcy committed by him, or any information material to the full disclosure of his dealings ; that all the estate of the bankrupt, and (see Wright v Fairfield, 2 B. & Ad. 727, 732) every beneficial matter belonging to his estate, shall pass to his assignees for the advantage of his creditors ; that the effect of the certificate shall be to discharge the bankrupt from all debts due by him when he became bankrupt, and from all claims and demands made proveable under the bankruptcy ; and although the Act has provided a new tribunal for the consideration of the certificate, it expressly reserves to every creditor, who gives notice of his intention to oppose, the right of being heard by the Court against the allowance of the certificate. Such being the spirit and general tenor of the Act, what say the 198th and 256th sections ? The statutable meaning of the term " trader," used in reference to a bankrupt or to bank- ruptcy, may be, I think, as it were, historically explained. In the earlier Bankrupt Acts, the word " trader" is not to be found. The statute 13 Eliz. c. 7, and the two Acts passed in the reign of James I., which formed the code of law for more than a century, provide, " that any merchant or other person using the trade of merchandise by way of bargaining, &c., or making his trade of living by buying and selling, who shall depart the realm, begin to keep house, or do certain other IN BANKRUPTCY. 185 acts, shall he," in the words of the statute of Elizabeth, "re- 1850. puted, deemed, and taken for a bankrupt," and in the words . Exparte of the statute of James, " accounted and adjudged a bankrupt Jakdine, to all intents and purposes ;" and the statute 13 Bliz. c. 7, jabdinb. s. 2, states, " that the Lord Chancellor for the time being, upon every complaint made in writing against such person or persons being bankrupt as is before defined, shall have full power by commission under the great seal to name, assign, and appoint the persons therein described to take by their discretion, order, and direction with the body of such person, &c. ;" and the statutes of James (1 Jac. 1, c. 15, s. 3, and 21 Jac. 1, c. 19, s. 3) enact, "that the like commissions which are provided by the former Act (13 Eliz.) against any bank- rupt therein described, shall be had and taken against such person and persons that are herein expressed to be^JDankrupts," &c. The 5 Geo. 2, c. 30, which extended the description of persons to be subject to the statutes, says (sec. 39) — " Bankers, brokers, and factors, shall be, and axe hereby declared to be, subject and liable to this and other the statutes made con- cerning bankrupts." The 13 & 14 Car. 2, c. 24, a declaratory Act concerning bankrupts, is, I think, the first statute in which the term trader is used. It says that no person holding stock in the East-India Company or the Guinea Company shall, by reason of such adventure of their moneys, " be ad- judged, taken, esteemed, or reputed a merchant or trader within any statute for bankrupts, or be liable to the same." Then the 6 Geo. 4, c. 16 (for some years the great Consolidation Act in bankruptcy), introduces the term, " trader liable to become bankrupt." It enacts that bankers, brokers, and various other dealers, enumerating them, shall be deemed " traders liable to become bankrupt," and the Lord Chan- cellor, upon petition made to him in writing against any trader (a shorter and more convenient term than " person or persons being bankrupt as is before defined," used in the stat. 13 Eliz.) having committed any act of bankruptcy, by any creditor of such trader, is, by commission under the great 186 REPORTS OF CASES 1850. seal, to appoint sucli persons as to him shall seem fit, who shall, bv virtue of the Act and commission, take order and Ex parte ' •> Jabdinb, direction with the body of such bankrupt, and with his lands, Jabdine. &c., and the Commissioners, upon proof of the petitioning creditor's debt, and of the trading and act of bankruptcy of the person against whom such commission is issued, shall thereupon adjudge such person bankrupt ; and the subsequent Act (5 & 6 Vict. c. 122, s. 10) enacts, that certain other persons specially named " shall be deemed traders, and subject and liable as traders to this and the other statutes relating to bankrupts." The Bankrupt Law Consolidation Act contains a similar enactment to that in the 6 Geo. 4, c. 16, that certain persons and dealers enumerated " shall be deemed traders liable to become bankrupt ;" and the enactment is introduced with the words " with respect to persons liable as traders to become bankrupt." I take the word " trader," then, as used in the Bankrupt Acts, to be a genuine term, denoting a class of persons made liable to become bankrupt, and to be subject to the bankrupt law ; and " to regard the conduct of the bankrupt as a trader," seems therefore to require regard to his conduct, not merely in the course of the particular trade which he carried on, but as one of such class of persons made liable to become bankrupt, and thereby subject to the statute relating to bankrupts, by which statute aU his estate of every description, whether acquired in the course of his trade or otherwise, is divisible amongst his creditors ; and all his creditors of every description, whether in respect of debts contracted in the course of trade or otherwise, are to share rateably in the division of such estate, with an exception in favour of some very few who are to be paid in full. Now, it is very material to observe that the bankrupt law, in admitting creditors to come in under a bankruptcy, makes no distinction between debts contracted by the trader in the course of his trade and any other debts. Indeed, the law goes, further. In the case of Bailie v. Grant, 9 Bing. 121 (also reported in 1 Clarke & Fin. 238, and 2 Moore & Scott, IN BANKRUPTCY. 187 193), determined in the House of Lords, the opinion of all 1850. the judges was taken, and it was decided that a commission of bankruptcy may be supported on a debt accruing before the Jaedinb, bankrupt became a trader, and an act of bankruptcy committed jardinb. after he ceased to be a trader. The Lord Chief Justice Tindal says, " The debt contracted before trade, but remaining unpaid at and after the time the debtor enters into trade, appears to be a subsisting debt for every purpose, and subject to every consequence which belongs to a debt originally contracted during trade." The reasons given by the Lord Chief Justice for the judgment in that case appear to me of great weight in the present case, and lead to the conclusion that all debts proveable must be treated as debts contracted by the bankrupt as a trader, within the meaning of the Bankrupt Law. His lordship says, " It is the same with respect to the trader's ability to carry on his trade. The money lent to the person who afterwards commaences trade may be, and often is, the capital upon which the trade itself is carried on. At all events, the credit given to the trader by the forbearing to demand repayment, is one of the sources from which such capital is derived, and is the same in effect as a new loan. Again, the debt is attended in both cases with the same con- sequences as to the trader's ability to repay it ; for in each the power of repayment is equally affected by the success or failure of the trader." Then his lordship adds, " No one would contend that a debt contracted during the period of trading, though not a trade debt, but contracted for private purposes, and applied to private occasions perfectly distinct from the trade, is to be considered as differing in any respect from a debt contracted in the course of the trade itself" Following the reasoning of the judges in the above case of Bailie v. Grant, I think " conduct of the bankrupt as a trader" must be regarded with reference to all matters of or relating to the bankrupt with which the statute actually deals, and must necessarily embrace conduct in the mode of con- tracting any of his debts whatever. Is it reasonable that a 2 88 REPOKTS OP CASES 1850. person should be permitted, as against his creditors, to put oflF and resume the character of a trader at pleasure ? Surely Ex parte . . ., „ Jakdine, any conduct of the bankrupt, from the civil consequences ot Jakdine. which he seeks a discharge under his bankruptcy, ought to be deemed conduct as a trader. But further, I think the words "before as well as after his bankruptcy" are deserring of remark. It appears to me more difficult to apply the term " trader," in the narrow sense contended for, to a bankrupt after his bankruptcy. An uncertificated bankrupt after his bankruptcy, cannot trade as against his assignees ; if they interfere, he would be acting merely as their agent ; if the assignees do not interfere, he may certainly trade on his own account (see Tyson v. Chambers, 9 M. & W. 469 ; Whit- more V. Gilmour, 1 2 M. & W. 808 ; and Herbert t. Bayer, 5 B. 965) ; but the Legislature could, hardly intend to direct the attention of the Court solely (if at all) to his conduct in trading on his own account after his bankruptcy (a trading in which his assignees and creditors under the bankruptcy would have no interest), and to exclude from the consideration of the Court his conduct in matters wherein he was acting as agent to his assignees, more especially when the Legislature contemplates the probability of his so acting, as appears by the power given to the assignees (12 & 13 Vict. c. 106, s. 150) to appoint the bankrupt to carry on the trade for behalf of the creditors, and in any other respects for administering his estate in such a manner as they may think best. Then, again, I think the 256th section of the Bankrupt Law ConsoUdation Act also affords a solution of the meaning of the words " con- duct as a trader," in the 198th section. The 256th section enumerates certain offences (nine in number), some supposed to have been committed after, some before, bankruptcy, and having relation generally to the bankrupt's trade, dealings, or estate, or to any of his creditors, and which offences may or may not have been committed in the course of his trade, or as a trader in the sense contended for ; for instance, destroying any book, &c. relating to his trade, dealings, or estate, with IN BANKRUPTCY. 189 intent to conceal the state of his afiairs, or defeat the objects 1850. of the law of bankruptcy — ^making false entries, or wilfully ~ altering any book relating to his trade, dealings, or estate, Jakdine, with like intent — contracting any of his debts by any manner Jakdinb. of fraud, or by means of false pretences — giving undue pre- ferences to any of his creditors in contemplation of bankruptcy with intent to diminish the sum to be divided — attempting to account for any of his property by fictitious losses or expenses — making a vexatious defence to any suit for the recovery of any debt or demand proveable under the bankruptcy, &c. The section seems to suppose that any of these offences may have been committed by the bankrupt " as a trader" within the meaning of the Act. Observe the words — " If at any sitting or adjourned sitting for the allowance of the certificate of any bankrupt, it shaU appear that he has committed any of such offences, the Court shall refuse to grant such certificate, or shall suspend the same for such time as it shall think fit, and shaU refuse to grant protection." The term, " conduct as a trader," in the 198th section, cannot, I think, consistently with the assumption in the 256th section, be confined to conduct in the course of his trade. For the reasons, therefore, which I have given (from the general importance of the question) at greater length than I should otherwise have done, I am of opinion that the construction of the 198th section, in conjunc- tion with the 256th section (for, although the latter follows some distance in the Act, it may be considered as virtually incorporated with the power), is this : that the Court is to regard the conduct of the bankrupt as one of a class of persons liable to be so adjudged, before as well as after his bankruptcy, and herein to regard his conduct in any matter concerning which the Court is authorized to call for information and discovery, always bearing in mind that the statute contains provisions expressly limiting the power of inquiry to such matters as relate to the person, trade, dealings, or estate of the bankrupt, or any act of bankruptcy committed by him ; and if it shall appear on the hearing for the certificate that the 190 REPORTS OF CASES 1850. bankrupt has committed any of the offences mentioned in the „ 256th section, the Court must refuse or suspend the certificate Ex pa/rte . . Jabdine, for such time as it shall think fit. In other cases the Court Jarmne, (in the words of the 198th section) is "to judge of any objection against allowing such certificate, and either find the bankrupt entitled thereto, and allow the same, or refuse or suspend the allowance thereof, or annex such conditions thereto as the justice of the case may require." This appears to me to be the fair, sound, legitimate construction of the Bankrupt Law Consolidation Act with respect to the certi- ficate of conformity. To adopt the narrow construction contended for would, I think, operate only to enable a trader to commit frauds, to release broken promises, and to defeat just creditors ; whilst the more liberal construction which I have given is supported, I think, not only by the reasonable- ness of the thing, but by the words of the statute itself, as explained by the whole course of legislation in bankruptcy, with respect to traders, and by the reasoning of all the judges in the case which I have before cited of Bailie \. Grant, 9 Bing. 1 21, in the House of Lords ; and following such con- struction, the intention of the Legislature wiU be followed out, and justice is promoted. Having disposed of the legal objec- tion, I proceed to deal with the case upon its merits. Jardine, the bankrupt, was a draper ; he succeeded to the business of his father, which had been carried on in the town of Dartford for half a century. He was also actuary of the Savings Bank at Dartford, for a period of about thirty years — that is, from the first establishment of the bank, in 1816. For the first two or three years he acted as the assistant of his father, who was the founder of the bank, and subsequently, the duties becoming onerous, he was appointed to act solely, at a fixed salary, and he continued to do so up to the time of his bank- ruptcy. It may be concluded, then, that the bankrupt, pre- vious to the discovery of his delinquency, had long enjoyed the respect and esteem of the inhabitants of Dartford and its vicinity. Moreover, he had at different times been selected to IN BANKRUPTCY. 191 fill offices of honour and trust in Ms native town ; in fine, he was regarded, in every sense of the term, as an honest trader. The sequel will show how far he abandoned all title to the appellation. In the course of his business, the bankrupt had pecuniary difficulties to contend with, arising from a declining trade and reduced capital : in this state of things, in his position as actuary of the Savings Bank, being in the habit of receiving money from depositors, he was tempted, in the year 1844, under a pressure which he says was temporary, to apply the money of the bank to his own uses. I have no doubt that the bankrupt intended and believed that he should be able to replace the money ; but one trick often needs a great many more to make it good, and the bankrupt, unhappily for others as well as himself, too readily yielded to this evil sug- gestion. It is said that he did repay some of the moneys which he had appropriated. I fear, however, this was done by the aid of subsequent deposits ; at all events, he goes on misapplying moneys intrusted to him as actuary, and thus fiuudulently incurs fresh liabilities. It is urged that he had to struggle against misfortunes — ^losses by bad debts and stag- nation of trade, followed by contagious sickness in his family. It might be hard in such distress to bear up against the storms of fortune ; but no change of circumstances can absolve a man when he relinquishes truth and faithfulness — " the band that knits together and supports all compacts,'" — and has recourse to a system of fraud, supported by artifice and falsehood. The course he pursued was, when money was brought for investment in the bank, to enter it in the depositors' books, in all instances correctly, but in respect of the moneys which he misapplied, he omitted his next important duty, which was to enter the money so received in the cash-book of the bank, which was kept by himself. The bank ledger was kept by another clerk, and it was the duty of this clerk to post the cash-book ; but the bankrupt having withheld entries of various sums from the cash-book, was necessarily the cause of the omission of those amounts in the ledger. The cash-book purported to 1850. Ex parte Jabdine, re Jabdinb. 192 EEPOETS OF CASES 1850. Ex parte Jardihe, re Jaedine, contain entries of all deposits received by the actuary. It appears, then, that the bankrupt, a trader, •who, from his long standing in trade, and the public offices he had filled, ought to have been an example to others, as one "having a good conscience — wiUing to live honestly in all things," in- stead of despising a repetition of practices constantly coming in competition with the first principles of commercial life, shows a wretched regardlessness of what is due to himself and society, and scruples not to prop his credit by schemes of treachery systematically sustained for about five years. With this weight upon him, or during the times of its accumulation, his present trade debts were contracted, and when he was found to be a defaulter to the savings bank, he made an assignment of all his property to the trustees of the bank.. This act, which was done to benefit the trustees, under an apprehension that they were entitled to be paid in full by virtue of the statute 3 & 4 Wm. 4, c. 14, has, in truth, been the means of securing for the latter a rateable division of the bankrupt's property. If this assignment could have been carried out, the general creditors would have got nothing. Most fortunately also for the general creditors, the trustees of the savings bank failed in their attempt to bring their claim against the actuary within the provision of the 3 & 4 Wm. 4, c. 14, s. 28, which gives to trustees of savings banks a right to be paid in full (and in preference to other creditors, how- ever meritorious their claims may be), all money, which any officer of the bank may have received by viiiue of his office or employment. I thought (and the Vice-Chancellor confirmed my judgment) that the actuary was not authorized by the rules of this bank to receive deposits. One of the managers or comimittee-men ought to have attended for that purpose. It is not pretended, however, that any neglect of the managers of the bank can palliate the violation by the bankrupt of the confidence reposed in him. He was in a situation above sus- picion : — ^how humiliating the position in which he now stands ! Indeed, there is no vice which does so cover a trader with IN BANKRUPTCY. 193 shame as to he found false and perfidious in pecuniary matters. 1850. Mr. Linklater states that the bankrupt has met with com- miseration and sympathy from many quarters. I think it Jaedine, right, therefore, to say a word upon the very serious nature of Jaemm his offence and misconduct. " The consideration of what is essential to the security of savings banks is a subject of pecu- liar delicacy and extraordinary importance — one upon which the mere existence of a doubt is a grave and most serious evil. To promote habits of frugality and saving among the labour- ing population, by providing them with a perfectly secure depository, is the object of all legislation upon savings banks. It is impossible to conceive a more benevolent purpose, or one which more deeply affects the well-being of the whole common- wealth ; and if there be a public fund more sacred than another, that to which the greatest sanctity should belong, and which should be beyond the reach of all suspicion, is the fund which the poor have been enabled, by an almost heroic forbearance, to treasure up against future want.'^ .... " The poor save, they seek to have safe depositories of those savings, and they farther hope to be able at any time, if un- foreseen want presses upon them, to have power over the money which they have deposited." The observations which I have just cited are too true to admit of doubt or controversy. The writer goes on to ask, " How has Parliament dealt with this fund V That is a point upon which it is not my province at the present time to enter ; but, taking the law as it is, and finding that the bankrupt was debited in his balance-sheet with a sum exceeding 2,000/. to one of the institutions to which I have referred, it became my duty to inquire how that amount of debt was contracted, and having so done, I must give judgment as on a matter of right or wrong. In awarding punishment (if refusing or suspending the certificate can pro- perly be so called, when the granting of it ought to be deemed a positive approbation), the Court should consider the base- ness and dangerous tendency of the offence, the deliberation and wilfulness, or the inconsideration, suddenness, or surprise 194 REPORTS OF CASES 1850. with or under whicli it was committed, and any other circum- stances which may aggravate or extenuate the guilt ; and in Jaedine, the present case the Court should especially look to the para- Jakdine. mount importance of sustaining the confidence of the indus- trious classes in the officers of savings banks. In conclusion, I would observe, that this is one of the numerous instances which now almost daily occur, exhibiting the want of a public prosecutor. The bankrupt has committed a most grievous public offence, but in respect of that, the public justice of the country has not yet been satisfied. I am to look at the case, however, simply in a commercial point of view ; and, confining my attention to the conformity of the bankrupt to the law of bankruptcy, and to his conduct as a trader within the meaning of the Bankrupt Law Consolidation Act, I think it would be a monstrous perversion of the spirit and intention of that Act to hold a person entitled to a discharge from civil obligations which he has contracted, in the manner and under the circum- stances I have pointed out, and whose conduct has been in the last degree reprehensible in having carried on trade, not merely on a fictitious credit, in the ordinary sense of that term, but upon a credit upheld by his embezzlement of bank deposits, the small savings of the laborious classes — a species of fraud heartless in the extreme, and most mischievous in its conse- quences. I should add, that I think the bankrupt has com- mitted an offence (No. 3) under the 256th section, in respect of some money received from depositors subsequently to the 11th of October, 1849, and which he also appropriated to his own use ; and considering the repeated similar acts previously, I deem this offence to have been committed under circum- stances of great aggravation. It now, therefore, only remains for me to adjudge that the allowance of the certificate to the bankrupt Jardine must be refused. IN BANKRUPTCY. 195 1851. (Before Mr. Cominissioner Fane.) Ex parte Cooper, re Cooper. February 1st. The facts axe set forth in the judgment. Se,^h^^* Lord Chan- ■ • -n mi'- T cellor nor the Mr. Commissioner I^ane. — This is a most extraordinary Vioe-Chancel- case. It has been, as I understand, before Vice-Chancellor banfa-uptojr' Knight Bruce, sitting in bankruptcy, and before the Lord tasjurisdic- Chancellor, both of whom disclaimed jurisdiction, and now bankrupt per- ., IP T. • _li_ • • • ^■ !_■ ^ mission to file it comes before me as havmg the primary jurisdiction under a bill to enforce the Bankrupt Law Consolidation Act, 1849. It is a petition *^^ perfo™- ^ ' -r ance of trusts by a Lieutenant Cooper, who was adjudged bankrupt in 1831, ™ which he 1 j!i 1 -11 1 • • claims an in- praymg that he may have leave to nle a bill or claim m terest. Chancery to enforce the due performance of several trusts prayer ^fTpe- vested in the late Mr. Josh. Strutt, in which trusts the ^i*''"^ *» ^^^ commissioner petitioner alleged he has an interest, because, if duly praying leave enforced, there would be such a sum coming to his assignees &c. is, that the for principal and interest as would pay all his debts and leave assignees may '^ '^ ^ ■' be ordered to him a considerable surplus. I might dispose of the case permit the perhaps by saying that, upon the petitioner's own showing, the use their names proper persons to file a biU or claim would be his assignees, proper indem^ and that I, sitting in bankruptcy, have no authority to nity against . . costs. compel the Court of Chancery to permit him to sue on rights Where itap- which, if they exist at all, are vested in his assignees. But ban£upt has^ I wiU not pursue that course, because he might then shift his *° interest in ■■ _ ° _ certain trusts, ground, and pray that I would compel his assignees to allow and claims , . ,, f. ,1 • ■ nn 1 . . compensation him the use of their names m Ohancery, he giving a proper for losses caused iademnity to them against costs. Had his petition asked of thetraste^s* this relief, it would have been right in form, and I will therefore t^e proper 11-11 i_i.ii --11 1 course for him deal with the matter as though the petition had so prayed, to pursue is to Assuming that such had been the prayer of the petition, a missioneTto" question, not of law, but of discretion, would have presented summon the trustees and all proper parties to produce the deeds. Petition by the bankrupt for leave to file a bill dismissed with costs. 196 EEPORTS OF CASES 1851. itself for consideration, — viz., ought I, or ought I not, to sanction the proposed suit ? — the decision of which question depends upon Ex parte r r t , i i CooPEK, the circumstances of the case. They are very comphcated, and CoopEB. somewhat loosely stated. The substance, however, seems to be this : — In 1781, on the marriage of Mr. and Mrs. Cooper, the petitioner's father andmother, 4,000/. was vested in two trustees, Mr. Douglas, the father of Mrs. Cooper, and one Brown, upon certain trusts, the benefit of which, in the events which hap- pened, centred, to some extent, at least, in the petitioner, or one of six children of the marriage. Brown died, leaving Douglas surviving. Douglas died in 1796. His personal representative was the late Mr. Josh. Strutt, who, being named by Mr. Douglas an executor, alone proved the will. Mr. Josh. Strutt took charge of the 4,000Z., and advanced it to Mr. Cooper, the petitioner's father, on mortgage of certain estates, and on repayment ia March, 1810, again advanced it to Mr. Cooper, the father, in April following, on mortgage of an estate called the " Woodeave's Estate," where Mr. Cooper appears to have had a cotton-mill. This 4,000/., it is alleged, was lost by the insufficiency of the security, or in some other way, before March, 1831, when the petitioner became bankrupt ; he says that it has never been accounted for either to him or his assignees. He complains that his assignees never asserted his rights, and he now asks to be allowed to do so, using their names. This is the first of the alleged breaches of trust. The next, as alleged, arose thus : — Mr. Douglas, the father of Mrs. Cooper, the petitioner's mother, carried on the business of a cotton-spinner, in partnership with Mr. Cooper, the petitioner's father, and a Mr. Matchett, at the Woodeaves MiU. The partnership was for forty-two years, ending April, 1826. Mr. Douglas died in 1796, having, by his will, left one-tenth of his interest in that business for the benefit of the children of his daughter, Mrs. Cooper, equally. The profits were to be accumulated for each child till it attained twenty-one, and then each was to enjoy his own share. Mr. Douglas named Mr. Josh. Strutt, who was also his son-in-law, and therefore uncle IN BANKRUPTCY. 197 by marriage of Lieut. Cooper, his executor, and Mr. Josh. 1851. Strutt proved the will, and thus became trustee, as it is alleged, Z J. , , .,, Expm-te. for the children of Mrs. Cooper. It is then stated that the Coopeb, accumulations for the children appear by the books of the firm Coopee. to have amounted, on the 1st of January, 181 6, to 7,355^., but that on that day Mr. Strutt permitted 5,133^., part of those accumulations, to be handed over to Mr. Cooper, the father, and that in 1825 the accumulations had again amounted to 3,006/. ; but in April, 1826, when the forty-two years' partner- ship expired, they had been again reduced to 276/. These facts, it is alleged, constitute a second breach of trust, for which Mr. Strutt was accotmtable to the children of Mrs. Cooper. A third breach of trust is said to have arisen thus : — On the 28th February, 1823, Mr. Josh. Strutt executed a deed, to which he was himself party of the first part, three of the petitioner's sisters and the petitioner were parties of the second part, and . Mr. Strutt himself, John Douglas Cooper, the petitioner's brother, and a Mr. Higginson, were parties or trustees of the third part ; whereby Mr. Josh. Strutt, in consideration of love and affection, paid to John Douglas Cooper and Higginson 4,000/. upon trust to invest that sum in the names of himself, Strutt, Cooper, and Higginson, upon certain trusts, as to one- fourth, for Clara EHzabeth Cooper, until she should become bankrupt or insolvent, then for the trustees to apply at their discretion for her benefit, and after her death, to apply as she might by wiU or deed appoint ; and in default of appointment, for her children equally ; and in default of children, for her surviving brothers and sisters, except John Douglas Cooper ; and as to the other three-fourths, for Lieutenant Cooper and two other children of the late Mrs. Cooper in the same way. This 4,000/. was immediately advanced, the petition does not state to whom, under deeds of the 24th and 25th March, 1823, on the security of the Woodeaves estate before men- tioned. The 4,000/., it is alleged, has also vanished, and this is stated as a third breach of trust, in respect of which the assignees might and ought to sue proper persons, and amongst 198 EEPOKTS OF CASES 1851. those, the representatives of Mr. Josh. Stratt, who died in 1844. ' Under these alleged circumstances, the questions I am called CoopEB, upon to consider are — 1st. Whether the assignees ought to Cooper. Sue ; and 2nd. Whether, if they decline, on account of the risk attending the prosecution of so complicated a suit, after such a lapse of time, I ought to compel them to allow the petitioner to use their names, he giving a proper indemnity against costs. Now I entertain great doubt whether there was ever any breach of trust whatever. I will take each alleged breach in its turn. First, then, as to the 4,000^. settled in 1781. The benefit of that trust vested partially in the petitioner as early as 1823, for in that year Mrs. Cooper died, having survived her husband some years, and then one-sixth at least of that fund belonged to the petitioner. He attained twenty-one in 1817. In 1823, therefore, when his mother died and his rights arose, he was twenty-seven years of age. Is it likely that neither he, nor his brother or sisters, knew of their rights under their father and mother's marriage settlement ? Can it be supposed that his elder brother, John Douglas Cooper, and his sisters, were ignorant of them ; and can it be supposed, but that if one knew of them, all must ? The strong probability is, that all knew the circumstances, acquiesced willingly in what was done, and were aU extremely glad to accept the benefits conferred upon them by the deed of gift executed by Mr. Strutt in their favour, on the 28th February, 1823, the very year in which the mother died, and their in- terests under the deed of 1781 vested in them. There was indeed, at that time, an additional reason why they should feel under great obligation to Mr. Strutt, for the deed of 1823 was constructed expressly to secure them from the risks of partnership and bankruptcy in which they were involved, or might have been advised they were involved, by accepting the one-tenth of the profits of the Woodeaves Cotton Mill busi- ness, under their grandfather Mr. Douglas's will, who had then been long dead. That that business was not very flourish- ing, is shown by the petitioner's own statements, for he him- IN BANKRUPTCY. 199 self says that, out of 7,355/. accumulated before 1816, 1851. 5,1S3/. was passed to the account of John Cooper, the father, ' on the 1 st of January, 1816, probably to meet losses ; and that Cooper, the subsequent accumulations, which in 1825 had risen to .cooper. 3,006/., had, in 1826, when the partnership expired, dwindled down to 276/. It is suggested that Mr. Strutt's acquiescence in the transfer of the 5,133/., and the subsequent loss of the 8,006/., constituted a breach of trust by him as executor of Mr. Douglas's will ; but the high probability is, that if the cir- cumstances could at this distance of time be fully investigated, it would be found that these accumulations, being trade profits, vanished under the influence of trade losses, and that Mr. Strutt was in no way responsible for them. As for a breach of trust, I presume the petitioner and his advisers do not suppose that Mr. Strutt was to carry on the business as trustee for the children, and when profits were made, set them aside for the children, and when losses occurred, bear them himself. With regard to the third breach of trust, arising out of the alleged loss of the 4,000/. generously given by Mr. Josh. Strutt to his brother-in-law's children, in February, 1823, the claim is, to say the least, most ungenerous ; but it is as unfounded as it is ungenerous. The fond was safely invested by the trustees. Josh. Strutt, John Douglas Cooper (the petitioner's brother), and Higginson, on the security of the Woodeaves farm, and that farm was sold in January, 1831, for 11,403/. ; and it appears by the petitioner's own statement that deeds were then executed, dated the 7th and 8th days of January, 1831, whereby, after reciting the whole history of the two trusts, — ^that of 1781 and that of 1823, — and the cessation of the partnership of Matchell, Cooper, and Co., in 1826, and tracing what had become of the interests of the several persons interested in that partnership, including the whole of the Cooper family, it was stated that out of that 11,403/., 4,000/. was paid to Josh. Strutt, as trustee under the deed of 1781 ; 4,000/. to Josh. Strutt, John Douglas Cooper, and Higginson, as trustees under the deed of 1823 ; 200 REPORTS OF CASES 1851. and the balance, 3,403^., to the different members of the Cooper family, in whom the Woodeaves Mill property appears CooraR^ to have been vested, in certain proportions. Up to this point Cooper, tl^e^e appears no ground for supposing any breach of trust by either Mr. Stratt, or Messrs. Strutt, Cooper, and Higginson. The trust funds were safe and in the hands of the trustees. But it may be said, what became of those funds afterwards ? The answer is obvious. It appears by the petitioner's own statement, that from 1826, when the forty-two years' partner- ship expired, down to March, 1831, Lieutenant Cooper had been a sleeping partner in the cotton-null business, which had been carried on by his brother, John Douglas Cooper, and himself, at "Woodeaves Mill, in partnership, and that part- nership had become bankrupt, and a commission had issued against the two brothers in March, 1831. The proceedings were produced before me ; and it appeared by the solicitor's bill, filed amongst them, that the assignees and their solicitor inquired most carefully into the transactions of 1831, and the Strutt family and their solicitor furnished every necessary information, and produced all necessary documents to satisfy the assignees. The assignees appear to have been satisfied ; and the probability is, that the inquiry then made clearly showed that all the interests of Lieutenant Cooper, whatever they might have been, — ^his interest under the deed of 1781, his interest under the will of Mr. Douglas, and his interest under the deed of gift of 1823, including those he derived by representation from the deceased members of his family, were either pledged to individual creditors before his bankruptcy, or realized under it. It is unreasonable to suppose that the investigation then made was otherwise than full and satisfac- tory. There were ample funds to pay for inquiry, for the estate paid 7s. in the pound and upwards, and therefore it is probable that the inquiry was an active one. But if it were not so, and if further inquiry were now necessary, the proper course would be, not to ask me to compel the assignees to allow the use of their names as plaintiffs in a Chancery suit, IN BANKRUPTCY. 201 but to ask me to summon the proper members of the Strutt 1851. family, or their solicitor, to produce all the deeds which were „ executed in or about January, 1881, and with the aid of these Cooper, documents to investigate the case afresh. The present pro- cooper. ceeding, therefore, is altogether misconceived, and I feel that it is my painful duty to dismiss this petition with costs. But I should be glad to hear that the assignees had voluntarily waived their right to costs. It is due to the memory of the late Mr. Strutt, who is charged with these breaches of trust, and who died in 1844, to observe, that besides making the kind and careful provision for Lieutenant Cooper which he did in 1823, — a provision carefully framed to protect him from utter destitution, if his being involved in the liabilities of the Woodeaves cotton-spinning business, under Mr. Douglas's will, should bring him to bankruptcy, — Mr. Strutt also left him an annuity of 501. a year by his will. Be Fowler. T/iwrsday February Sth. A. HE facts are set out in the judgment. Builder- Meaning of tile term in the JUDGMENT. statute. A person The question in this case was, whether Mr. Fowler was a Si'^eVrXdon builder within the bankrupt law. It appears that he was an "^^^ architect, . • £ 1 • 1 ^^^ purchased architect, but that not being satisfied with the revenue derived several pieces from that source, he took a piece of ground in Grosvenor- diffSent'piaces, square, on which a house stood, and having pulled down the ^^ P^jJ^** house and erected one in its place, offered the new-built house buildings for sale or other disposition. He then took the ground on on, and built new houses with mate- rials which he bought for that purpose, and did not employ a builder to carry on the works, but did himself pay the several persons employed thereon, with the intention of selling or otherwise disposing of the gi-ound and the buildings so erected thereon, is a builder within the meaning of the bankrujrt laws. .202 KBPORTS or CASES 1851. wMch the late Mr. Hope's house stood, in Duchess-street, and proceeded to erect on it thirteen new houses, and these also he Fowler. buHt for Sale or other disposition. Since then he has taken the ground on which a large house stood in Harley-street, and has pulled down the house and built two other houses on the site. These, also, he built for sale or other disposition. He did all these works as a builder, not employing a builder, but buying materials, and employing masons, bricklayers, carpen- ters, joiners, and other persons, to do the work, sometimes paying by contract, and sometimes paying day wages. It appears that he employed a foreman and timekeeper. Now I admit that by the old law, and before the word "builder" was inserted in the Bankrupt Act, a person so acting would not have been liable to the bankrupt laws. He would not have been liable, because traders only were liable, and none were deemed traders except those who bought and solA personal chattels. Buying a real chattel, converting it into a personal chattel, and selling it when so converted, was not a trading ; and hence he who took a coal-mine, severed the coals, and sold them, was not a trader : he did not buy a personal chattel, he bought a real chattel. And so he who bought personal chattels, converted them into a real chattel, and sold them so converted, was not a trader : and hence a person who took land for a time, built on it, and sold the buildings, was not a trader : he did not sell a personal chattel, he sold an interest in land. These niceties occasioned inconvenience. It was evident that persons who took leases of land to build on and sell, or let the houses when built, were substantially traders, and ought to be subject to the incidents, and have the benefit of the law of bankruptcy ; and the word "builder" was inserted in the bankrupt law as a description of a new class of persons, thenceforth to be comprised in the provisions of bankrupt law. But, it may be said, what is a gentleman who builds on his own estate a number of houses to improve his property,— ris he a builder, liable to the bankrupt law ? Perhaps not : first, because he confines his transactions to his own estate, and IN BANKRUPTCY. 203 therefore there is not anything like a general trading ; and, 1851. secondly, because there is no ground for presuming that he ~ will extend his operations beyond his own estate. But that Fowlek. argument does not apply to the case of a person who takes ground expressly for the purpose of building houses on specula- tion, first in one place, then in a second, then in a third, and so on, and does it evidently to make a livelihood, — such a person is, in my opinion, emphatically a builder within the bankrupt law. He is the very person to whom the Legislature intended to give the protection, and on whom it intended to fasten the responsibilities of the bankrupt law. It was urged before me, that Mr. Fowler never built for any person but himself ; that he would not have built like a common builder on the order of any customer : but to this the answer is, that such a person would have been subject to the law of bankruptcy under the old law ; and therefore, if we were to confine the lately-intro- duced word " builder" to such persons only, we should really strike the word " builder" out of the Act; for it would mean nothing. I was then referred to the case of Stuart v. Sloper, 3 Ex. Rep. 700, and it was said that there the alleged bank- rupt had done exactly what Mr. Fowler had done in this case, yet was held to be no trader. To that case my answer is, that it lays down no principle of law but this, that where a conclusion of fact is in the province of a jury, and the direc- tion to the jury has been right, the Court will not disturb their finding. Now, in that case the question left to the jury was, whether Mr. Stuart's proceedings were isolated trans- actions or not, and they found they were ; and the judges considered their fitnding conclusive, and declined to disturb it. Of that case I will only say, that I should have come to a different conclusion had I been one of the jury. But their conclusion is not binding on me. A commis- sioner of this court is jury as well as judge ; and, in my capacity of juryman, I say that I have not the least doubt that Mr. Fowler's were not isolated transactions, but that he meant to go on with them as long as he could make a p2 204. EEPORTS OF CASES 1851. Re FOWLEE. profit to satisfy him, and therefore I think he was a builder within the Act, and I must decline to reverse the adju- dication. («) Wedmesday, April 2nd. Conditional certificate. Where the bankrupt^ im- mediately pre- s^ious to the fiat, disposed of goods for bills which appeared to be fraudu- lent, but it was not established that the bank- rupt was a party to the fraud, the cer- tificate was suspended for two years ; but the condition was annexed, "that if the bankrupt should pay to his estate the value of the bills previous to the certifi- cate becoming due, he might then apply for an immediate certificate, " •(Before Mr. Commiaeioner Fonblanque.) Ex parte Byfus, re Btfus. JL HE fiat issued in 1843 ; immediately previous to that date the bankrupt disposed of goods to a considerable amount to one Ewards, and in payment for the same he took bills of exchange drawn by one Hart on Ewards. The bills were dishonoured. It appeared that, at the time of this transaction, Hart was an uncertificated bankrupt, and Ewards has never been heard of. The bankrupt now applied for his certificate. Lucas, counsel, for the assignees, and Parry, counsel, for certain creditors residing in the country. — This has been a fraudulent disposition of the estate, in con- templation of bankruptcy. The bills appear to be merely concocted by the bankrupt and others for the purpose of deluding the creditors. It has not been shown that such a person as Ewards ever existed. Lewis, solicitor, for the bankrupt. — It has not been shown that the bankrupt was privy to any fraud in the making of the bills ; he may have been deceived himself in the transaction complained of. The Commissioner, in giving judgment, among other remarks, said, — A gross fraud has evidently been committed in (a) On appeal to the Vice-Chan- cellor, his Honour was pleased to direct an issue to try the facts as to the trading. IN bankrupg;cy. 205 the concoction of these bills ; but though it is not proved that 1851. the bankrupt was a party to it, yet it is quite clear that at a ~ ' time when he ought to have been particularly vigilant, and Byfus, dealing with a person whom he had good reason to distrust, he byfus. was guilty of such gross and culpable negligence in parting with goods virtually the property of his creditors, as amounts as nearly as possible to a fraudulent making away with pro- perty ; on that ground I shall require him to make reparation. That which has been afforded by his brother, the other bankrupt, — the payment of a hundred pounds, — is by no means sufficient. I shall suspend Solomon Byfus 's certificate for two years, unless in the mean time he restores to his credi- tors that which has been so improperly abstracted from them, the amount of the two bOls drawn by Hart and purporting to have been accepted by Edwards or E wards. In the event of such payment, he may apply for an immediate certificate. (Before Mr. ConuniEsiioner HOLBOTD.) Re Robinson. April 8th. XHE bankrupt, who was in custody under an execution, Discharge of ^■ T J- T • ^ A- ii.i_ bankrupt from appued tor his release. Assignees were not yet chosen. custody; Practice. The proper Hilleary, solicitor, for bankrupt. time for the bankrupt's ap- plication for r„rno pon+ra his discharge jjueas, contra. ^^^ custody is after the choice, unless Mr. Commissioner Holrotd. — The object of the statute in all parties giving the Court power to discharge a bankrupt from custody is to enable him to assist his assignees in discovering and getting in the estate. The Court is, therefore, not in a posi- tion to decide as to the discharge till after the choice, unless aU parties consent. Let the application stand over till assignees have been chosen. 206 REPORTS OF CASES 1851. Practice — where the cer- tificate hag been sus- pended, and the bankrupt died before the time for grant- ing the same had arrived, on an application for a certificate by the repre- sentatives of the bankrupt : Held, that fact of the death of bank- rupt ought to appear on the certificate. (Before Mr. Commissioner Goulbdrn.) Be Neale, Ex parte Neale. i HIS was an application for the bankrupt's certificate. Bagley, counsel, was twice heard in support of the applica- tion, and Mr. Conunissioner Goulbtjrn tdtimately directed that the allowance by the certificate should be suspended for three calendar months, from the 27th November, being of opinion that the bankruptcy was not occasioned by unayoidable losses or misfortunes. The bankrupt died on the 22nd February, 1851, before the expiration of the three months for which the certificate was suspended, and his solicitor afterwards appUed for the certificate. The Commissioner intimated, that he entertained some doubt whether a certificate should be granted to a bankrupt who was no longer in existence. After con- sulting Mr. Commissioner Holroyd, however, the learned Commissioner stated that he saw no reason for refusing the certificate, as it might be material to the representatives of the bankrupt. He directed the fact, however, to appear on the certificate that the bankrupt was dead. The certificate, after stating in the usual form that the allowance of the certificate was suspended for three calendar months, contained the follow- ing words : — " And I find that the bankrupt departed this life on the 22nd February last." IN BANKRUPTCY. 207 1851. (Before Mr, Commissioner HolBoyd.) Be Dennis. J^'f ±?' JJeNNIS was adjudicated a bankrupt under a fiat whicli Onanadjudi- . cation against issued in tne year 1848. Mr. Bristow was chosen assignee, anuncertifi- The bankrupt did not pass his last examination or obtain a ^^ assign'^s ' certificate. Subsequent to that period the bankrupt commenced ""g^* *° ^® '■ "^ "■ chosen. trading, and incurred new debts and liabilities, and in February, in the present year, was again adjudicated bankrupt in respect of the new trading, and a new petitioning creditor's debt. This was a meeting for the choice of assignees under the second adjudication. Bagley, counsel, for the original assignees, asked that the choice might be adjourned in order that the original assignees might have the opportunity of bringing the question before the Court as to the vesting of the estate acquired subsequently to the first bankruptcy, so that litigation might be avoided. Lawrance, solicitor, contra. Mr. Commissioner Holkotd. — Late cases have established that a second adjudication against an uncertificated bankrupt is not absolutely void. There is here a new class of creditors, who have a right to be represented. It may or may not appear that the original assignees acquiesced in the subsequent trading, and it is necessary, therefore, that there should be some persons before the Court to represent] the new estate in case of any question arising between the creditors under the old, and those under the new bankruptcy. The choice must be proceeded with, (a) (o) See Ex parte Bourne, 2 G. & Ex parte JvmgmicTtael, 2 M. D. & D. J. 137 ; Ex parte Welsh, Mont. 276; 471 ; Ex parte Butler, ib. 731. Ex parte Deuas, 4 D. & C. 366; 208 BBPOBTS OF CASES 1851. First-claea certificate. (Before Mr. Commissioner Fonblanqub.) Be NOETHOWER. X HE bankrupt purchased a share in a patent which turned out a failure. The adjudication was on his own petition, and the estate showed assets to the amount of 20s. in the pound. The CouBT was pleased to grant an immediate certificate of the first class. Satwday, April 5t)i. Equitable mortgage ; Fixtures. Fixtures on charged by way of equit- able mortgage pass to equitable mortgagee. (Before Mr. Commissioner Evans.) Ea; parte Edwards, re Hamer. i HE bankrupt was indebted to Edwards in the sum of 260^. secured by the deposit of a lease, accompanied by a memoran- dum in the following terms, yiz. : — " The lease you hold as collateral security for 250^. I am ready to convey to you when- eyer called upon so to do." There were on the premises comprised in the lease fixtures of the value of 251. The premises and fixtures were sold, but did not realize suflicient to repay to Edwards the sum advanced by him. Edwards now applied to prove for the residue of his debt, and the question was, whether the fixtures formed part of his security, or whether the assignees were entitled to receive the sum for which they sold, such sum to be added to the residue to be proved for. Bagley, for Edwards. Jones, solicitor, for the assignees. Mr. Commissioner Evans, on the authority of Ex ■parte Backhouse, 2 M. D. & De Gex, decided that the fijctures passed under the equitable mortgage. IN BANKRUPTCY. 209 1851. (Before Mr. Commissioner Stevenson.) Re HioaiNSON. M^^t^l March 26th. L HIS was an application for reheariag in tlie case of Mr. Practice ; jH- '■'■ _ ° risdiotion of Jonathan Higginson, whose certificate was altogether refused commissioner ; some time ago by Mr. Serjeant Ludlow. renewed appli- The application for a rehearing of the question of certificate i^'° j ^°^ ''^'^' was made on the ground that the certificate had been refused . -A- commis- in consequence of the absence of certain evidence which the pointed in the bankrupt at that time could not bring forward, but which he fo^^er com- was now in a position to adduce. His Honour, having heard missioner has . jurisdiction to the arguments, took time to consider, and this day delivered entertain all applications over which his JUDGMENT. predecessors had any au- Mr. Commissioner Stevenson. — This is a petition by the thority; and, bankrupt, praying that a sitting may be appointed for the where a cer- aUowance of his certificate. This allowance has already been tificate had •' been refused refused by my predecessor, Mr. Serjt. Ludlow, and it is to be after hearing observed that a memorandum of such refusal, under his hand, commissioner, is on the file of the proceedings in this court. The grounds ^^gg^o^err' of such refusal are not mentioned in the memorandum, but competent to hear a renewed in this petition certain grounds are stated, which, it is application for alleged, are those upon which this certificate was refused. But held* The petition also states that certain facts, which were not in 207ij*^*\*''® evidence before my predecessor, and which in consequence of the Bank- thereof he refused to take into consideration, were material Consolidation and generally in favour of the petitioner's application, and if ^e'cafeTm'"^ they had been fuUy before and explained to my predecessor, which such renewed appli- the petitioner believes that he would not have refused the cation might be certificate, and that these facts are such as to warrant his pealed the '^*' renewing his application for his certificate. The circumstance P""?™!""^ °^ ° '■'■ 5 & 6 V ict. c. 122, re- lating to such renewed applications, and consequently that the Court has no jurisdiction to entertain any such application under circumstances not specified in the Bankruptcy Law Consolidation Act. 210 REPORTS OF CASES 1851. of the original application for this certificate having been heard before my predecessor, seemed to me at first to involve HiGGiNsoN. some difficulty as to my power of entertaining this application, for want of jurisdiction on that ground alone, conceiving that it was open to the objection that, by so doing, I should be sitting, as it were, on appeal fi:om his judgment. It has, however, been urged, that the fact of my appointment to this district in the room of my predecessor would be to give me jurisdiction to entertain this, as well as every other applica- tion over which he had any authority, and to as full an extent as he could have done had he remained the commis- sioner of this district, and, in fa<;t, to deal with this case as if I were personally representing him ; and, after considera- tion, I am inclined to take this view of the case, although I cannot but feel that it is subject to great doubt. But sup- posing this view to be correct, the application is still open to the question of want of jurisdiction upon other grounds, which have been raised in opposition to this petition. These grounds are, that application can only be made under the recent Bankruptcy Law Consolidation Act, and in cases provided for by the 207th section — that is, when the Court shall see good and sufiicient cause to believe that the refu- sal of a certificate has been obtained by false evidence, or by reason of any improper suppression of evidence, or otherwise fraudulently obtained, none of which cases, it is contended, occur in the present instance ; and of which there can be no doubt, nor, indeed, was any pressed on behalf of the peti- tioner ; but it is contended on his behalf, that the original hearing of the certificate having been under a former Act (5 & 6 Vict. c. 122), then in force, the authority to deal with this application would be under the jurisdiction conferred by that Act, and which still remains for this purpose. In the first place, with regard to such jurisdiction giving authority to rehear a matter of this description, very great doubts have always been entertained whether the Commissioners of Bank- ruptcy have any such authority, and I am under the impres- IN BANKRUPTCY. 211 sion that it is the general opinion of the Commissioners that 1851. they have no such power. In the case of Ex parte Harris, mentioned in the argument, and reported in the sixth volume Hiogikson. of the Law Times, it appears that Serjeant Goulbum con- sidered he had no such authority, although he referred to a case in which, under very special circumstances, a rehearing was granted. But it has been shown that my predecessor in one instance where he has refused a certificate has granted a rehearing, and subsequently allowed the certificate, and that was stated in the course of the argument ; and even in this case he considered that he was not precluded at some future time from rehearing the case. Admitting that this applica- tion might have been entertained under the former Act, the question still remains whether the former jurisdiction of the Court can now be exercised in this instance. Now, unless there are any words in the Consolidation Act by which this jurisdiction has been expressly reserved, I apprehend it is quite clear that all such jurisdiction has been repealed by that Act. The first section, which repeals the former Acts, and which has been referred to on this subject, contains only this exception, which comes home as bearing on this point, viz., " except so far as may be necessary for the purpose of supporting any proceedings taken, or to be taken, under and after the commencement of this Act by any trading, &c. or other proceeding in bankruptcy before the commencement of this Act." Now, it appears to me quite impossible to hold that this word " proceeding," used in either part of the sentence, can have any reference to an application of the present description ; and, besides, it would not be a proceeding taken, or to be taken, under the Consolidation Act, which directs that all proceedings in bankruptcy depending at the commencement of the Act should be proceeded with and brought to a conclusion under the provisions of that Act, and which shows, I apprehend, the intention of the Legislature to be clearly, that any application, of any kind whatever, can only be made under the jurisdiction conferred by this consolidated 212 EEPORTS OF CASES 1851. Re Hl&QINSON. Act. Therefore, in whatever view the question of jurisdic- tion may be taken, in this case it appears to me that I have no authority to entertain this application, and I am bound, therefore, to dismiss this petition, which I do quite irre- spective of any merits of the case, and solely for want of jurisdiction. In cases of dis- puted adjudi- cation under the 12 & 13 Vict. u. 106, s. lOi, the general rule is, that the pe- titioning cre- ditor must begin, and establish any of the requisites disputed, before calling on the alleged bankrupt to show cause. (Before Mr. Commissioner GouLBUEN.) Be Clay. ± HIS was a question of disputed adjudication under the Act 12 & 13 Vict. c. 106, s. 104. Parry, counsel, for the bankrupt. Bagley, counsel, for the petitioning creditor. A preliminary discussion took place as to the obKgation of the parties to begin. On the part of the alleged bankrupt it was insisted that the petitioning creditor was bound, in the iirst instance, to examine his witnesses and establish. the three requisites necessary to sustain the adjudication, precisely as if there had been no previous adjudication ecc parte. On the other side it was suggested, that by the express terms of the 104th section, the alleged bankrupt was to show cause against the original adjudication to the satisfaction of the Court, and if he failed so to do within the period specified in the Act, the original adjudication became absolute without more ; and from this provision it was argued, that the peti- tioning creditor had already established a prima, facie case, and could not be required in the first instance to produce any evidence. It was admitted at the bar that the practice in reference to this question was not settled. Mr. Commissioner Goulburn thought the question so IN BANKRUPTCY. 213 important, as matter of practice, that lie consulted with his 1851. brother Commissioners, Evans and Holroyd, and subsequently announced that they had come to the unanimous conclusion. Clay. that in ordinary cases, and as a general rule, the petitioning creditor upon a disputed adjudication should be called upon to begin and adduce all the evidence on which he means to rely, in order to establish the trading petitioning creditor's debt an act of bankruptcy. The Court, however, reserved to itself the discretion of alloTiring the petitioning creditor to adduce further evidence at any subsequent stage of the pro- ceeding, if further evidence was deemed necessary. Bagley, for the petitioning creditor, then called the attesting witness to a deed of assignment for the benefit of creditors, which was the act of bankruptcy relied upon, and the witness was cross-examined by Parry, with a view to establish the objection relied upon. Ex parte Bedford, re Bedford. ^ May 2^th. J. HE last examination of the bankrupt was adjourned sine jurisdiction ; die without protection ; on that occasion a creditor applied P^^""^® °^ for a certificate of proof under sec. 267 (Sched. B a. The Court . A\TTi T °^ Bankruptcy Bankrupt Law Consolidation Act). He then sued out a alone has juria- writ of ca. sa. in the Exchequer, under which the bank- ^der a bank- rupt was arrested, on the 22nd of April, 1850. There was rupt'^ dis- ^ 1 1 • , charge from no other detaining creditor, and the bankrupt, having been custody. A in prison up to the present time, he now applied for his ^a" arrestld " discharge. by virtue of a ° ca, sa, sued out by a creditor who obtained a certificate of proof under sec. 257, is entitled to his discharge after he has been in prison twelve months, although he hag not passed his last examination. Semble, that at the expiration of the twelve months the gaoler ought to take notice of the statute and discharge the prisoner. 214 REPORTS OF CASES 1851. Expajrte Bbdfokd, re Bedford. Naylor, for the bankrapt, relied on sec. 259, (a) and quoted Walker v. Edmonson, 20 L. J. 186, Q. B. Cole, solicitor, contra. — The bankrupt has as yet furnished no accounts to his assignees, though he had ample time to do so. He is in the same position as when he was arrested, and is therefore not entitled to his discharge. Mr. Commissioner Goulburn (after having consulted Mr. Commissioner Holroyd). — This case is to be discussed wholly on sec. 259, which must be construed to mean, that where a bankrupt has been in prison for :a less period than a year, he shall not be discharged without the order of this Court, but that after the year has expired he is entitled to be set at liberty ; and it is questionable whether the gaoler ought not to take notice of the statute, and discharge the prisoner when the period of imprisonment set forth in the statute has expired, without any order from this Court. My opinion is founded on the following reasons : — 1. This Act ought to be construed in favor em libertatis, in conformity with the opinion expressed by Lord Tenterden in Lewis v. Moreland, 2 B. & A. 64. 2. This is the first enactment in which the general principles of the bankrupt law have been interfered with. Up to the time when this statute came into operation, a creditor was obliged to elect whether he would prove under the bank- ruptcy, and abandon all other remedies against the bankrupt ; but now having proved, and even received a dividend, he can, under certain circumstances, arrest the bankrupt. The power of detaining the bankrupt in prison ought to have a limit. 3. The process under which the bankrupt is in cus- tody, in fact, commences in this court by virtue of the certi- ficate of proof, although the intervention of another Court is (a) " If any bankrupt shall be shall not be discharged from such taken in execution after the refusal execution until he shall have been of protection, or after the refusal in prison for the full term of one or suspension of his certificate, he year, except by order of the Court." IN BANKRUPTCY. 215 afterwards required. This Court is, therefore, the proper 1851. tribunal to order the discharge when the terms of the statute Ex parte have been satisfied. 4. It has been decided in Walker v. Bedeord, Edmondson, that the Consolidation Act transfers all the bedfokd. jurisdiction as to the bankrupt's discharge, when he has been taken in execution, to this Court. I will, therefore, order the discharge. No injustice can follow, for this Court has now the power to compel him to furnish satis- factory accounts. Ordered that the bankrupt be discharged. (Before Mr. Commiasioner Fonblanque.) Ex parte Cross, re Piggott. May idth. VjROSS and Co., immediately previous to the adjudication, stoppage m sold to the bankrupt three separate parcels of oats, and sent "''rte vendor the same to the Eastern Counties Railway, with the following ^°^^ several instructions, viz. : — goods, and sent them by railway to be " The superintendent at the March station, E. C. R. deUvered to ^ the purchaser ; the expense of " Sir, — About 15 qrs. W oats, ex Green ; 20 qrs. W oats, delivery was to ex Frear. The above two parcels of oats will be delivered at the vendor. your station on Monday ; please inform us of quantity and ™^3°^ere weight gross of each parcel, and forward them to the order of delivered, Mr. W. Piggott, at the Cambridge station, and charge the vendor, having carriage to our account. You had better mark one parcel to ttTsSv^cy with a X with chalk. — We remain, yours, &c., °i ^^^ P?"^" ^ , '' chaser, directed " J. & T. Cross. the proper offi- "V^ n f K l««n" cer of the rail- •"*y5,j"Ct. O, loOU. way company not to deliver the rest : The other parcel, being oats of another price and description, th^^^'^'d^'^h^ d was sent in a similar way, with similar instructions. a "ght to sto^mWmmtu. 216 EEPOKTS OF CASES 1851. Ex parte Ckoss, re PiGGOTT. Some part of the oats had been deKvered to the bankrapt ; but on the 17th of October, Cross and Co. wrote to the rail- way superintendent at Cambridge, reversing their original instructions, and requesting him to hold the goods on their account. At the time when such letter was written, Cross and Co. were not aware of the fact of Piggott having been adjudicated a bankrupt, although they had doubts as to his solvency. Francis Cross (one of the partners in the firm of Cross and Co.) went to the station-master at Cambridge, and told him to hold the oats for the further instructions of the firm, and that the parties to whom the oats were sold would produce an order from the firm for them. There had been several previous transactions in oats between Cross and Co. and the bankrupt. It was the custom of Cross and Co. to pay the carriage and rent for warehousing of the oats, and the expenses of carrying the same from the company's premises to the carts sent by the bankrupt for them. The assignees claimed the whole of the goods as part of the bankrupt's estate. Lawrance, solicitor, for Cross and Co. — The goods had not passed into the bankrupt's possession ; we had a right to stop them in transitu. {Whitehead v. Anderson, 9 M. & W. 518 ; Tanner v. Scomll, 14 M. & W. 28 ; Gibson v. Gar- ruthers, 8 M. & W. 301. See Mason v. Lichbarrow, and Lickbarrow v. Mason, 1 Smith, L. C. 3rd edit. 388, and notes ; and Wentworth v. Outhwaite, 10 M. & "W. 436 ; Re Gales, 1 De Gex, 100.) Cole, solicitor, for the assignees. — The vendors had parted with their right to the goods, which they could not recall, and the bankrupt had the right to take possession of them, and actually did so, as to part : the taking possession of part affected the actual ownership of the whole ; and from the time when the part was delivered, the vendors' right to stop in transitu ceased. IN BANKRUPTCY. 217 Mr. Commissioner Fonblanqub. — It • may be taken as a general rule, that so long as there remains anything to be done by the vendor, or at his risk or charge, the transit is incomplete. In this case, the corn was to be conveyed from" the railway warehouses to the bankrupt's waggons at the expense of Cross and Co. ; and was, therefore, in transitu. The only doubt is, whether the bankrupt had taken possession of the whole of the com by taking away a part of it. I am of opinion that he had not. On the 11th of October, the bank- rupt signed the declaration of insolvency. On the following day he took away sixteen quarters of oats. On the 15th, the declaration of insolvency was filed, and on the 18th, Piggott was declared bankrupt on his own petition. Now it was bad enough that he should have taken away the sixteen quarters ; but I will not, on that account, impute to him the intention of taking the whole forty-eight quarters, when it had become perfectly evident that he could not pay for them. The case of Tanner v. Scmell is much stronger than that which is now before me ; I must, therefore, declare that the oats remaining in the warehouse of the railway company did not pass to the 1851. Ex parte Cross, re PlSGOTT. (Before Mr. Commissioner Fane.) Ex parte Allcaed, re Milton. X HE facts are set forth in the judgment. Lawrance, solicitor, for the petitioner. — We rely on the statute of Victoria as a general statute, in which the statute of Anne, being only a particular statute, relating to one county, is merged. There having been one public registry, this case does not come within the meaning of this statute of Anne. A judgment registered un- der 1 & 2 Vict, c. lie, s. 19, will not be a charge on lands in Mid- dlesex, when it has not been the county, under 7 Anne, u. 20, s. 18. 218 REPORTS OF CASES 1851. Browne, counsel, for the assignees. — The statute of Anne ' ' cannot be affected by the subsequent statute of Victoria, AiiOAKD, unless by express words ; and as there is nothing contained in Milton. t^e later Acts inconsistent with or contradictory to the former, the statute of Anne must still be in fall force, and be com- plied with in order to raise a charge against lands in Middlesex. He cited Johnson v. Houldsworth, 1 Sim. N.C. 106. JUDGMENT. Mr. Commissioner Fane. — This was a petition by Mr. Allcard, praying a declaration that a judgment debt of 138^. and interest due to him under a judgment entered up in November, 1849, against the bankrupt, was a charge upon certain leasehold land of the bankrupt, sold under the bank- ruptcy for a sum exceeding 138^., and praying payment out of the proceeds of the sale. Allcard was the holder of a bill of exchange accepted by Milton, and had sued him, and had got judgment, and had registered his judgment under 1 & 2 Vict, c. 110, s. 19, so that, jBn'waa facie, his title was clear under that section, and s. 13 of the same Act ; but it was objected that the land in question lay in Middlesex, and that he had not registered his judgment under the Middlesex Registry Act, 7 Anne, c. 20, s. 18; and I am of opinion that that objection is fatal. By that Act it is provided that no judgment shall affect land in Middlesex, but from the time that a memorial of such judgment shaU be entered in the Middlesex Registry Office. To this it was answered, that I ought to construe that clause with reference to the preamble of the Act, which, after reciting the power which ill-disposed persons had of undoing purchasers and mortgagees, to the utter ruin of them and their famiUes, by secret ways of conveying lands, &c., pro- ceeded to make several provisions, evidently, as it was alleged, for the protection of purchasers and mortgagees, and of no one else ; and among others, the provision in question ; and it was urged that that provision, though general in its terms, ought, in construction, to be limited to cases where purchasers or IN BANKRUPTCY. mortgagees required its protection. I cannot accede to this argument. The preamble of a bill is no doubt to be read as an assistant to the construction of any enactment in it which is of a doubtful nature, but it is not to control those which are clear. If the rule were otherwise, the preamble would be the enactment ; it is, however, not at all improbable that the Legislature might have thought that if a little more publicity were given to the existence of judgment-debts in this great assemblage of traders, there would be no harm done. It was then suggested that the provision in s. 19 of the 1 & 2 Vict. c. 110, requiring the registry there specified, must have been intended to supersede or repeal the provision of the statute of Anne, for otherwise, there would be two registers of the same debt. I cannot, however, acquiesce in this argument. The one registry is applicable to the whole of England, the other to the county of Middlesex only ; and I cannot conceive how a special provision for the protection of all persons interested in the lands situate in Middlesex can be repealed by a general Act, not making the slightest allusion to it. This point, how- ever, was decided by Vice- Chancellor Rolfe, in Johnson v. Holdsworth, 1 Sim. N.C. note, 106. The question before him was, whether a] judgment creditor, not having registered his judgment in the West Riding of Yorkshire, was a necessary party to a redemption suit relating to lands there, and he held that he was not, as he had no interest in the lands tUl regis- tration in the county ; and he held this, notwithstanding the argument was used, that the 1 & 2 Vict. c. 110, ss. 13 & 19, substantially repealed the Local Registry Act. I must therefore dismiss the petition with costs. 219 1851. Ex parte Alloabd, re Milton. Q2 220 REPORTS OF CASES 1851; (Before Mr. Commissioner Fohblanque.) Friday, ANONYMOUS. May IZrd. Bankrupt 1 HE bankrupt, as executor of A. B. deceased, by leave of against his own tte Court, made a proof against his estate for the sum of fond'^ihert"'' ^^*^- ^^^- ^^- l^eciueathed to him by the testatrix, in trust the fiind was (amona; other persons) for C. D., a person of unsound mind, small and the , , , , ^ , \ ^ ■, , , • • • • person benefi- Dut who had not been declared to be so by an inquisition. cially inter- ested was of unsound mind, Upou the application of Reid, solicitor, and after reading not been de- the will of the testatrix, the Court was pleased to order that inquisition— '^'^ the amouBt of any dividend or dividends to be declared on Order as to the g^gj^ proof, when carried to the dividend account under the application of ^ the dividends, general order, be transferred in the Bank of England by the accountant in bankruptcy, to the credit of the matter of the bankrupt, to the account of the trust-estate of the testatrix, " and the said accountant is to cancel any dividend-warrants drawn for such dividend or dividends ; that the said dividends, when so paid into the said bank, be laid out in the purchase of Bank Three per Cent. Annuities, in the name and with the privity of the said accountant, in trust in the above matter to the like account; and the said accountant is to declare the trusts thereof accordingly, subject to further order ; and that the interest to accrue due on the said Bank Annuities, when so purchased, shall from time to time, during the life of C. D., be paid by the said accountant to the said bankrupt, and by him applied towards the maintenance and support of the said C. D., the said bankrupt producing to the said accountant, before receiving any half-year's dividends after the first, an affidavit in the form contained in the schedule hereto annexed ; and the said accountant is to hold the said Bank Annuities, and all future dividends thereon, after the death of the said C. D., subject to the further order of the Court." IN BANKRUPTCY. 221 1S51. (Before Mr. Commissioner Goulburn.) Tuesday. Be POWNALL. June nth. X HE facts are set forth below. conduct as a ' trader ; yex- JUDGMENT. ?^rge^:^:r tT /-^ ■ ■ m mi • 1 • conduct of the Mr. Commissioner (jOULBURN. — The case involves two points bankrupt in of considerable importance with reference to the construction ^l -^^11"^' of the late Act of Parliament. Mr. Pownall, as a solicitor, ^^^ken into con- sideration in was not liable to the bankrupt law ; and, accordingly, he had the question of at first sought another mode of relieving himself from his although the ' difficulties, by filing a petition under the Act of 7 & 8 Vict., ^fiS^iteTto"^ which applied to persons not traders. The judge of the small trans- Suffolk County Court had been of opinion that he was a A bankrupt trader, and he had then filed a declaration of insolvency, and |^ piei^n^f^*^ come before this Court. At the hearing the assignees had not sii^™ pl^as 11 (•■ 11 cT in an action, opposed, and it was clear they had a very friendly feeling although it towards the bankrupt ; Irat this might consist with the most "bfethalh™ high and honourable feelings on both sides, though it was tad a defence ° ° ^ _ m equity. more satisfactory when those representing the creditors at large looked into the case with a view to do justice' to all. One creditor, however, Mr. Bedwell, a gentleman of Chelms- ford, made a most strenuous opposition, both on general grounds, and on the bankrupt's conduct towards himself. He would consider both those grounds ; and first as to the bank- rupt's general conduct as a trader before and after the bank- ruptcy. It had been argued that the a«ts of trading were few, and small in amount, and were confined to the years 1844, 1845, and 1846, when the bankrupt was the owner of some small vessels, which he let out for the fishing-trade, and that his general conduct in matters in which he was not a trader could not be taken into consideration. The same arguments had been used in Wakefield's case, from Nottingham, where a merchant had improperly employed trust moneys out of his 222 REPORTS OP CASES 1851. trade ; and the question had also been raised in the case of _ Jardine, the actuary of the Dartford Savings' Bank, before PowNALL. Mr. Commissioner Holroyd, who had gone at great length into the meaning of the words — " conduct of the bankrupt as a trader," and held that they applied to his whole conduct in the contracting of any debts whatsoeyer. To this view he entirely subscribed, and should act upon it. It appeared that this gentleman had been bankrupt before, a considerable time ago, in 1834, when his debts were 8,000/., and he paid a dividend of 2s. 4d. in the pound. A former failure was by no means to preclude a man from attempting to regain his position, and to acquire respectability and affluence by trade ; but it ought to teach caution. In this case, he was sorry to say, Mr. Pownall did not seem to have profited much by the vicissitudes of trade. His present balance-sheet commenced on the 1st of March, 1846, when he was behind-hand 2,517/. 9s. It would have been better had he then looked his affairs in the face, and have come to this Court, or taken some means of winding up his affairs, instead of going on hopelessly increasing his load of debt, and increasing the wrong which he was doing to others. He now owed to creditors 4,198/., besides what he has made himself liable to on the acceptances of other parties, which increased the amount to 4,451/. Deducting from this the estimated value of security in the hands of a creditor, 250/., he remained liable for 4,201/. The profits, taken at his estimate, were 5,378/., leaving him to account for 9,579/. To meet this he had hardly anything. His furniture, deducting the rent and taxes due, would yield only the insignificant amount of 7/. He alleged his good debts to amount to 1,871/. ; doubtful, 206/. ; and bad debts, 1,208/. But it turned out that scarcely any of them could be called good ; for they had been sold by the assignees for 300/. to some one who most likely had a taste for litigation and County Court proceedings. His law costs were put down at 174/. The expenses, partly ascertained and partly estimated, were 3,067/. ; and it was not very easy to make out what was IN BANKRUPTCY. 22.S estimated, and what was not ; for Mr. Pownall, untaught by 1851. his experience of former failure, had kept his books in such a very slovenly way, that it was not easy to make them up. It Pownall. seemed they were never added up at all ; and the official assignee stated that it would have been impossible to do so, as the debits and credits were frequently mixed. It was singular that a man of education, and whose business it was to advise other people, should have conducted his business with such extreme negligence. Nobody could say that this was a man who, profiting by past misfortunes, had put his shoulder to the wheel, and resolved to retrieve himself by avoiding those errors which were certain, sooner or later, to bring a person to that court. This sort of conduct began to tell, as it was sure to do ; in 1846 he was in difficulties, and petitioned this Court under the 7 & 8 Victoria ; he then owed 2,668^., and it was arranged that he should pay 3001. into court; but this arrangement was never carried out, in consequence of an action being brought against him by a gentleman named Last, who he said had concurred in the arrangement. That action was defended, and, as Mr. Pownall lost the verdict, he declined to pay the 300^. into court, as, he said, with the acquiescence of his creditors. The petition therefore fell to the ground. He then petitioned the County Court ; and his debts were very differently stated in the two petitions, which it was not easy to reconcile. The County Court dismissed his petition, and he was here, not of choice, but necessity, to get his affairs arranged upon the hypothesis that he was a trader. It was impossible to look at his general conduct without feeling that it was culpable in the highest degree ; and, if such conduct were not visited with punishment in persons circumstanced like Mr. Pownall, the Court would act unjustly towards those who had more to allege in the way of ignorance and little acquaintance with habits of business. But Mr. Bedwell also complained that the bankrupt had done him grievous wrong personally, and had put him to unnecessary expense and delay by defending an action brought against 224 REPORTS OF CASES 1851. him,, to wliich he had in truth no defence at all, and to which he put no fewer than eight special pleas upon the record. It PowNALL. was contended that this brought him within the seventh section of the penal clause of the Act, the 256th, and that he was consequently not entitled to any protection whatever. Mr. Bedwell had been attacked as one who had acted with some sort of collusion, and unjustly, towards Mr. Pownall ; but he had never seen a man appear in a court of justice with cleaner hands. There was not the shadow of an imputation against him. The note, which formed the ground of the action, had been received by him from Mr. Last, executor of a gentleman of the same name, in part payment of a debt due from the deceased Mr. Last. When he brought his action, Mr. Pownall met him with his eight special pleas, every one of them alleging what was positively untrue. First, he said he did not make the note. It was now conceded on all hands that he did. Falsehoods of this kind were no light matter. It had been urged that he had a right to put his creditor to the proof of these matters, if they were true ; but this proposition he utterly denied. The whole object of the judges and the courts in altering the rules of pleading led to the opposite conclusion ; and they were now going further in the same direction, with a view to compel a party to state the truth, and only the truth, in answer to an action brought against him. The effect of this plea, denying that he made the note, would be to compel Mr. BedweU to have witnesses to prove the handwriting. The next plea, that Mr. Last did not endorse the note to Mr. Bedwell, was equally untrue. Then, he denied the consideration : in support of this plea not a particle of proof was given. The fourth, fifth, and sixth pleas — alleging fraud in the making and endorsing the note — were wholly unsupported. The seventh plea alleged that the defendant had obtained a certificate under the hands of Mr. Commissioner Evans, on his application under the 7 & 8 Victoria, before the endorsing of the , note to the plaintiff. It turned out that no such certificate had been IN BANKRUPTCY. 22.') granted. Could there be a grosser untruth than that ? The 1851. eighth plea denied that Frederick Last, the endorser of the ~^ note to Mr. Bedwell, was the legal executor of Isaac Last, Pownall. which was equally untrue. It had been urged that because Mr. Bedwell had not proceeded to tax his costs as against Mr. Pownall, but had taken out execution merely for the debt, he had thereby been put to no unnecessary expense. But he would have to pay his own solicitor, and every one knew the diflFerence as to costs between an undefended action and one where eight special pleas were put upon record. It was im- possible to avoid the conclusion that Mr. BedweU had been most grievously injured, and had been put to great and unnecessary expense and delay by these vexatious proceed- ings. It was a mistake to suppose that if a man had a muddy, confused notion that he might have an answer to a claim in a court of equity, he had therefore a right, in a court of law, to plead as many sham pleas as he chose, and to keep his creditor at arm's length, and put him to any expense he thought fit. This was to make a party a judge in his own cause ; every debtor would fancy that he had a defence somewhere or other, either in law or equity, or, at all events, in morality, either in this world or the next ; and having settled that point in his own mind, he would proceed, as in this case, to put a number of special pleas on the record, and pick his creditor's pocket by putting him to vexatious delay. The bankrupt was clearly within the meaning of this Act, the penalties of which were not at all too severe ; for nothing could be more mischievous than the practice of pur- chasing time by traders, when they became embarrassed, at the expense of their creditors. It was not merely a wrong to the particular creditor, but, in nine cases out of ten, the experience of that Court showed that the time so gained was employed by traders in making fifaudulent preferences, and abstracting property from the reach of the creditors at large. But in this case the question of time arose. The words of the 2.56th section were : — " If the bankrupt shall, within six 226 REPORTS OF CASES 1851. months next preceding the issuing of the fiat, or the filing of a petition for adjudication," have committed the offence PownIll. there stated. The eight special pleas were put on record on the 8th of February, 1850 ; the adjudication was not till the 31st of December in the same year, clearly more than six months after. It might be argued that in a case like this every continuance of delay and expense was a fresh offence ; but he had consulted Commissioners Fonblanque and Hoboyd, and they were of opinion, the statute being a highly penal one, that the offence had taken place more than six months before the filing of the petition. This was not a rule, which would apply to all cases of vexatious defence, as delay might be interposed in other stages besides the pleading. The bank- rupt was, therefore, exempted from the penal part of the statute, and the Court was not debarred, as it otherwise would have been, from granting him protection. By the course which Mr. Bedwell had taken in reference to the costs, there was no evidence of Mr. Pownall being indebted in these costs. Under these circumstances, it must be admitted, by accident, or good fortune, he was absolved, or escaped from the penal provisions of this Act, and remained responsible for his general conduct as a trader, and for the particular wrong done to Mr. Bedwell, without reference to the penal provisions superadded by that Act. Looking at the case as one in which there was very little to extenuate Mr. Pownall's conduct, considering his position and occupation, and the class of life in which he had hitherto moved, the Court would err very widely did it treat the case with greater leniency than was shown to persons with less education and with more excuse for their misconduct. The judgment was, that the certificate should be suspended for twelve calendar months, with protec- tion for three months, to be renewed from time to time, unless good cause were shown to the contrary. The certificate to be of the third class. IN BANKRUPTCY. 227 (Before Mr. Commissioner Fonblanqub.) Anon. Wednesday, Jamum-y 29t!i. A SUMMONS, under sec. 78, was sued out by A. and Trader-debtor ' ' •' summons ; directed to W. B., nurseryman, &c. ; in the particulars of trading not to demand W. B. was described as nurseryman, cow-keeper, at return of dealer in horses, dealer and chapman. ^"rh^defen- dant was de- scribed in the Bagley, in support of the summons. summons as nurseryman, &c., and in Lucas, contra, referred to the statute in sec. 65, et sea. P^''*"'"J«'rs of ' _ ' ' 1 demand as nur- It is not sufficient that the affidavit states that the person seryman, cow- suing out the summons " verily believes" that the debtor is in horses, "such trader." The truth of the affidavit must be inquired chapmr"^ into, and it must appear that the debtor is a trader within the , Summons held to be in- meaning of the statute, before it can proceed on the summons, sufficient. In the par- ticulars of Mr. Commissioner Fonblanqub. — How can I try the ^u^^d^d bt* trading now? Am I ia a condition to summon witnesses, or was stated to be to examine the defendant ? of money paid by the plain- tiff to a third Lucas. — Where the Court has jurisdiction, it has a power person for the use of the de- to do any act necessary to carry its powers into effect. fondant, with- out stating that it was so paid Bagley. — The rule referred to applies to the discretion of j V^ 5"®^* "^ the Court as to ordering the bonds : the only question raised Held to be at present is as to the validity of the summons. Summons dis- Mr. Commissioner FoNBiiANQUB. — There are two subsequent periods at which the question of trading may be raised. If a petition for an adjudication should follow, & prima, facie case of trading must be made out ; and subsequently, if the alleged trader should show cause against the adjudication obtained ex missed with costs. Anonymous. '228 REPORTS OF CASES 1851. parte, he can then dispute the trading ; so that if the party summoned is not a trader, the process is vain against him. Therefore, there is no cause to apprehend that the process of the Court can be abused. There has been much doubt as to what course the Court ought to pursue in such cases as the present ; but, after much consideration, all the commissioners have agreed to a resolution that the consideration of all ques- tions as to the validity of the trading and the other requisites to support an adjudication in bankruptcy arising out of these summonses, shall be postponed till the question of the adjudica- tion comes before the Court. The hearing upon the summons was then proceeded with. Lucas. — The particulars of demand are too uncertain ; no privity is there alleged to exist between the defendant and the person to whom the money is stated to have been paid. It ought at least to appear that the money was paid, as stated, at the request of defendant. The description as cow-keeper, in the particulars of demand, cannot be taken to be included in the word "&c." in the summons. Baghy, contra. {Gale v. LecMe, 6 M. & S. 228 ; Berry V. Fernandez, 8 Moore, 332 ; 1 Bing. 338 ; Anon. 1 Chit. 831.) Mr. Commissioner Fonblanqub. — "Where the debt is alleged to be due in consideration of goods sold and delivered, or work and labour done, the request of the defendant may be implied : but it is otherwise when the debt is in respect of money paid to one person for the use of another. The words descriptive of trading cannot be included in the word " &c." in the summons, so as to cure the defect apparent on the face of the summons. The^ summons must be dismissed with costs. IN BANKRUPTCY. 229 1851. (Before Mr. Commissioner Fonblanqce.) Be Dawson. '^'^'^,' March 6m. 1. HE bankrupt had been owner of the bark Cumberland, Seamen's ... , wages. which was lost on her voyage. The underwriters having Where an refused to pay, the assignees of the bankrupt brought an ™asbst^and action and recovered 2,000^. The bankrupt this day applied ^^^ insurance ■^ ./ J. J. recovered by for his certificate, which was granted of the first class. the owners : Previously to the verdict against the underwriter, a seaman the s ' applied to prove, and to be allowed three months' wages as a ^®^ ™id hf servant. The Commissioner recommended him to suspend his f^n °^^ "^ t^e insurance claim till it should be ascertained whether the assignees money, should recover under the insurance ; as, in that case, he was of opinion that the seamen would have the same rights as against the produce of the ship as they would have had against the ship herself. The Commissioner now stated, that though he had been unable to find any direct authority on the subject, probably arising from the recent change in the law, by the 7 & 8 Vict, c. 112, s. 170, which gave to seamen a right to their wages in cases of wreck, he retained his opinion, in conformity with the general rules of equity, that as the seamen had a lien on the ship, and special remedies for the recovery of their wages, which the statute appeared to be specially framed to preserve to them, they had a right to follow the produce. The wages, therefore, must be paid in full out of the money received from the underwriters. 230 BEPOBTS OF CASES 1851. (Before the Lobd Chancelloe.) Ex parte Woods, re Woods. Friday, fr^ May 2nd. J. HIS matter came before his lordship by way of appeal on Construction a Special case, on behalf of the bankrupt, under the Bank- ° piTi^ecom'- ™P* ^^''^ Consolidation Act, sec. 16, from an order of his missioner has Honour the Vice- Chancellor, to whom matters in bankruptcy junsdiotion to ... r j adjourn a cer- are referred, confirmiug the decision of the commissioner, ing, in order' under the circumstauccs stated in the petition, yiz. : — A pub- *° j°f''^^ \ lie sitting was appointed for the allowance of the bankrupt's has failed to certificate under sec. 198 ; at such sitting one Baker, a cre- opposition, an ditor of the bankrupt, who had proved his debt, prayed to be ^^ng'^uot °^ ^^^^^ against the allowance of the certificate, although he had notice, and of given no uotice to the registrar of his intention to oppose. hemg heard to .... oppose the cer- The bankrupt, by his solicitor, objected to Baker being heard; tificate at the i..i •• i i. ijij-n* adjourned but the commissioner was pleased to make the loliowing sitting. or^gj. ._ " Memorandum, that this being the day appointed by me, and duly advertised in the London Gazette, for the allowance of the certificate of the said bankrupt,' — Mr. Lawrance ap- peared as solicitor for the bankrupt, and prayed that the said certificate might be allowed, and Mr. Wilkinson appeared as solicitor for the assignees, and Mr. Cook, of counsel, appeared for George Baker, a creditor of the said bankrupti And Mr. Lawrance objecting to the right of Mr. Cooke to oppose on behalf of the said George Baker, by reason that he had not given the registrar notice in writing of his intention to oppose; and it appearing by the statement of George John Parsons, solicitor for the said George Baker, that the omission to give such notice was accidental, this Court doth order that this sitting be adjourned generally, and doth appoint a public sitting for the allowance of the bankrupt's certificate, to be held on Friday, the 31st day of January next, at half-past eleven o'clock in the forenoon precisely, of which sitting due notice is to be given in the London Gazette. And this Court IN BANKHTTPTCY. 231 doth order that the said George Baker do pay to the assignees 1851. and to the bankrupt, or their respective solicitors, the cost of " . Expwrte and occasioned by the adjournment of the said sitting ; and Woods, the solicitor of the said George Baker is to verify by affidavit, Woods. to be filed with the proceedings, his statement that the omis- sion to give notice of opposition was accidental," &c. &c. That on the 3rd day of January, 1851, an affidavit was filed with the proceedings in this matter, of which the follow- ing is a copy : — " In the Court of Bankruptcy. — In the matter of William Woods, of No. 15, Prospect-place, Wandsworth-road, late of Devonshire-road, Wandsworth-road, Surrey, builder, a bankrupt. " George John Parsons, of Haslemere, in the county of Surrey, gentleman, solicitor for George Baker, of Hilland, in the parish of Northchapel, in the county of Sussex, gentle- man, a creditor of the said bankrupt, who hath duly proved his debt under the fiat in bankruptcy issued against the said William Woods, maketh oath and saith that he was instructed by the said George Baker, upwards of two months since, to oppose the allowance of the said bankrupt's certificate ; but not being aware of the necessity for giving notice of such opposition to the registrar of the honourable Court, no notice was given, and that the omission to give such notice arose solely from this deponent's ignorance of the law in that respect, and from no other cause whatever ; except such last-mentioned affidavit, no affidavit has been filed in this matter by George Baker, pursuant to the said order ; that the bankrupt, feeling aggrieved by the said order, on the 3rd day of January, 1851, presented his petition of appeal to the Right Hon. the Vice- Chancellor, and prayed that the said order might be rescinded, and that his certificate might be granted, and such petition was heard on the 4th of March, 1851, when, after hearing counsel for the bankrupt in support thereof, and for the said Baker in opposition, and cougsel for the said assignees also Woods. 232 EEPORTS OF CASES 1851. appearing, but not opposing the said petition of appeal, his Honour dismissed the said petition with costs." ExpairU Woods re ' The bankrupt feeling also aggrieved by the last-mentioned order, and conceiving the same to be erroneous, appealed therefrom to this Court. The petition prayed that the order of the 4th day of March, 1851, and also the said order of the 21st day of December, 1850, may be discharged, and that the bankrupt's certificate might be granted. Russell and Willes, for the bankrupt, relied on the 198th section of the Bankrupt Law Consolidation Act. JSwanston, for Baker, contra. Fonblanque, for the assignees. The LoED Chancelior, after reading sec. 198, said, — The construction of this section must be governed by the intention of the statute taken as a whole. My opinion is, that all that is required is that the question of certificate should be heard on some day to be appointed by the Court, of which certain notices are to be given. The Commissioner is to judge as to the most proper day to be appointed ; but if on that day it should happen that the question could not be properly brought before the Court, I see nothing in the statute to prevent the Commissioner from appointing a new day, subject only to the provisions as to notice.(a) The Com- missioner, from having had the whole case before him from the commencement, is best able to judge as to the necessity of postponing the hearing of the certificate. I cannot, therefore,' interfere with the discretion he has exercised. The appeal must be dismissed with costs. The costs of the assignees were ordered to be paid out of the estate. (a) His Lordship observed, that, 'f<^ required to be given to the Court,' in the terms of the statute, the notice /j^nd not to the bankrupt. IN BANKRUPTCY. 233 1852. (Before Mr. Commissioner Godlbdrn.) Ex parte Fkith and Sands, re Wollaston. j^Jj Hi XHIS was a petition to annul the adjudication, stating Petition to An- that a petition for adjudication of bankruptcy, dated the where the 21st day of January, 1852, was on the same day filed by ^^J^fo^fj^e John George Lacy and David WiUiam Wilton, copartners benefit of the • TT Ti • TTT n ^111 \ bankrupt, and m trade, against Henry r rancis Wollaston (the bankrupt), not for distri- and that on the 22nd of January, 1852, the said Henry |i'"^ii°b^'an- Francis Wollaston was declared a bankrupt ; — on the same nulled, not- withstandmg day an official assignee was appointed. That at the time there is a imid when the said petition for adjudication was filed, the bank- creditor's debf rupt was indebted to the petitioner and his partners in '^°. ™PPO'"t the ^ ^ ^ adjudication, it the sum of 16,000^. and upwards; and that in respect is not sufficient of the sum 6,060/., part of the last- mentioned sum, they there are assets, obtained a judgment against the bankrupt in the Court sufficient* to°' of Exchequer on the 19th of January last, and the Bank- ™ake » divi- rupt was arrested upon a writ of ea. sa. on the 20th of A. carried January. That on the same day the bankrupt fiiled a "oion^, and" declaration of insolvency, dated at half-past three o'clock there became •' ^ insolvent. Hia in the afternoon, which was the act of bankruptcy. That on estate was dis- the 23rd of January they were served with notice that the cording to the bankrupt would, on the 24th of January, apply to the Court fo^e^b^t^'" of Bankruptcy, London, for an order for his immediate "eyer obtained a legal dis- release from prison, in pursuance of the Bankrupt Law Con- charge (similar solidation Act, 1849. That the bankrupt resided and car- Heafte'rwarfl' ried on business as a merchant at Cape Town, in the colony ?^™® t° reside '^ •' in England, but of the Cape of Good Hope, from the year 1847 to the month carried on no of December, 1849, when he wholly ceased to trade ; and ness. that on the 24th of December, in that year, he became an Held, he was ' •' ' not a trader insolvent under the then insolvent law of the Cape of Good within the Hope, and surrendered his estate and effects to be administered ; bankmpt laws. and that an order of sequestration was made, under which all the present and future estate, moveable and immoveable, per- 234 REPORTS OF OASES 1852. sonal and real, and every right, title, and interest in and to ^ ~7 any property, personal or real, wheresoeTer the same might be Frith known or found, which belonged or was due to the said re ' bankrupt at the date of making such order, or which might WoLLASTON. |jg thereafter purchased or acquired by, or might descend or be devised or come to, the said Henry Francis WoUaston, at any time before the making of the order of court allowing and confirming the plan of distribution named by his trustee, was vested in the Master of the Supreme Court of the colony, for the purposes of the sequestration. That by an order of the Supreme Court of the colony, dated on the 16th day of January, 1851, a provisional trustee of the estate and effects of the said bankrupt was appointed, and that by a subsequent decree of the Supreme Court confirming the appointment of the trustee, the said estate and effects of the bankrupt were divested from the said Master of the Supreme Court, and vested in the said trustee ; and that the bankrupt has not obtained his certificate from his creditors in the Cape of Good Hope under the said insolvent law ; and that by the said insolvent law of the Cape of Good Hope, the bankrupt is incapacitated and disqualified from acquiring and possessing, as against the trustee in whom his estate is vested, any pro- perty, goods, or effects, or any right to any property, goods, or effects : and that the bankrupt returned from the said colony of the Cape of Good Hope to England in the month of May, 1850, and has not since been engaged in any trade or business whatsoever on his own account or for his own profit. That the said Henry Francis Wollaston has no property, estate, or effects, of any kind or nature whatsoever, in England or elsewhere, to be distributed amongst his creditors under this adjudication. That on or about the 5th of April, 1849, and before the bankrupt became insolvent at the Cape of Good Hope, and when he had considerable property which might have been administered and distributed amongst his creditors under a fiat in bankruptcy, the petitioner and his partners caused a fiat in bankruptcy to be issued against the IN BANKRUPTCY. 236 said bankrupt, when Lacy (the petitioning creditor) refused to assist the petitioner in carrying out the fiat ; and that the fiat was annulled for want of an act of bankruptcy. And the debt due by the bankrupt to the petitioning creditor, in respect of which the present petition for adjudication is founded, is a debt in respect of which the petitioning creditor has been allowed to prove, and has taken a dividend under the insolvency at the Cape of Good Hope. That the bankrupt was not indebted at the date of the filing of the said petition, nor is he now indebted to the petitioning creditor in any sum sufficient to support the adjudication ; and that the petitioner believed that the said petition for adjudication was filed fraudu- lently and in collusion with the bankrupt for his benefit only, and for the purpose of defeating the execution of the peti- tioner, and not for the purpose of distributing any estate amongst the bankrupt's creditors generally, or for any pur- pose useful or beneficial to them. The petitioning creditor denied collusion, and declared that neither he nor his partner was aware of the filing of the de- claration of insolvency tiU the following day, when he was informed of it by the bankrupt; and that then, believing that the bankrupt was possessed of some estate, they filed the petition for adjudication to protect themselves. The bankrupt admitted the insolvency at the Cape, and that he had not received his certificate, and declared (as the fact is) that he believed the petitioners had proved against his estate under the insolvency, and had received a dividend ; and that he filed his declaration of insolvency without the knowledge or concurrence of the petitioning creditor : that he is possessed of property to the amount of 185/. and a life interest under his marriage settlement worth about 2001. or 3001., and that there are some book debts still due to his estate ; and that on a former occasion, when examined, he erroneously stated that he had no property in England, he not understanding the questions then put to him. a 2 1852. JEx parte Frith and Sands, re WOLLASTON. 236 REPORTS OF OASES 1852. Tyrrel, counsel, for petitioning creditor. — The bankrupt was in trade when our debt was incurred ; it is a legal debt, Expaa-te . . Fkiih and sufficient to support an adjudication. Ihe dividend an ^ANBs, jgpgjyg^ jjj respect of our proof at the Cape must be taken WoLLABTON. ^ pg^j.|. payment. We are in the same position as the petitioners as to the balance ; if our claim is extinguished, the same must be the case as to theirs ; but it has been held otherwise by the Court of Exchequer. The declaration of insolvency was filed without our knowledge ; but when we became aware of it, we were justified in taking measures to protect ourselves. Looking at the proceedings at law taken by the petitioners, it was natural for us to suppose that they were aware of the bankrupt being possessed of some means of satisfying their judgment, and we instructed our solicitor to take steps to enable us to share in any property that the bankrupt might have to be divided ; and the petition for adjudication was filed accordingly, and without regard to the bankrupt's benefit. — By the affidavit of the bankrupt it appears that there are assets. The adjudication would not release the bankrupt from custody of course. This case is distinguishable from Ex parte Gaitskell, 3 Dea. 635, which will be relied on by the other side. In that caee there was no pretence that there were assets, and there was direct collusion. Lawrance, solicitor, for bankrupt. — Ex parte GaitsMl can- not apply : when that case was decided, any collusion would void a bankruptcy. In the old cases, want of assets was taken as evidence of collusion, but now no adjudication is voidable on account of collusion. It is not incumbent on the petitioning creditor to show that there are assets, nor will the Court look to the extent of the bankrupt's estate. Bagley, counsel, for petitioner, relied on Ex parte Brund- lett, 3 M. & Ayr. 50, and Ex parte Gaitskell, which was decided subsequent to the stat. 2 Wm. 4, c. 56, s. 42, which IN BANKRUl-TCY. 237 enacted that concert should not void a fiat. The bankrupt's trading ceased by operation of law when he became insolvent at the Cape ; and there has been no trading since ; so that at the time when the declaration of insolvency was filed, the bankrupt was not a trader within the meaning of the bank- rupt laws. {Ex parte Chambers, 3 M. & Ayr. 294.) There can be no pretence of assets ; all the bankrupt's property is vested in the trustee appointed under the insolvency at the Cape, as if it had been assigned to him by deed, and he can enforce his rights here. The adjudication, therefore, can be for no other purpose than the benefit of the bankrupt. The adjudication must be void. {Ex parte Lewis, 1 M. D. & De Gex, 370 ; Ex parte Spicer, 2 M. D. & De Gex, 388.) 1852. JSx parte Frith and Sands, re WOLLASTON. Mr. Commissioner Gotjlburn. — I am of opinion that the adjudication ought to be annulled. The bankrupt was insol- vent at the Cape, according to the law of that colony, and all his estate became vested, under the sequestration, in the pro- per officer and trustees : he has not traded since that time. I adopt the principle in Ex parte Chambers, that having ceased to trade by operation of law, and not by his own act, he is not a trader within the meaning of the bankrupt law, there being nothing for that law to operate upon. A decla- ration of insolvency cannot be an act of bankruptcy when filed by a person who is not a trader under the statute. The object of the law as to filing declarations of insolvency is to enable traders to distribute their estates, and to avoid making preferences. The adjudication does not seem to have been for the benefit of creditors, but for releasing the bankrupt. The defence to the action failed, and it was decided that the plaintifis had still a remedy against the bankrupt's person : that remedy was immediately enforced. The bankrupt, on the last occasion that he was here, stated that he had no property ; but after the opinion of the Court was intimated as to assets, he corrects that statement ; but he has not shown that there was anything to divide. I do not 238 REPORTS OF CASES 1852. think this subsequent statement entitled to much credit. Ux parte Gaitskell is in point. The amount of assets is not Iwra to be considered as an objection, as a general rule ; but when and Sands, ^^^^ ^^^ ^^^ sufficient to make a dividend, as in the present WoLLASTON. pa^gg^ where the debts amount to many thousands, that fact ought to weigh with the Court to show the intention of the petition for adjudication. The adjudication must be an- nulled. (Before Mr. Commissioner Stevenson.) Re Pritchard, ex parte Knowlys. Order and dis- X HIS was an application on the part of a Mrs. Knowlys, Protected ^ *^® executrix of the will of her late husband, for an order transaction. of tj^jg Court directing the assignees of Pritchard to deliver Goods had . been in the or- up to her certain machinery, paint materials, and other sition"of the*"" articles alleged to belong to her husband's estate, but bankrupt, with ^jjjgjj -^ygj-g on the bankrupt's premises at the time of the the consent ot ... the owner. filing of the petition for adjudication. The assignees also the bankruptcy appHed for an order for leave to sell these chattels for the applications ^ g^ f ^j^ creditors, under the 125th section of the Bank- were made on ' behalf of the rupt Law Consolidation Act, on the ground that these goods owner, that the . . ,. . . goods might be Were in the possession, order, or disposition of the bankrupt, n^^rithstand- ^^ *^^ t™® ^® became bankrupt, by the consent and per- ing which, they miggion of the true owner thereof, according to the terms of still remamed _ ° in the order that SCCtioU. of the'taat "^ The material facts of this case are as follows. — Under an ™0 a lioa- ^g^^ement, dated the 17th of September, 1850, it was arranged tion to the that the machinery, materials, and other articles in question owner that the (wMch Were then on the bankrupt's premises, and had been mSw^be or- ^^^^ ^^ ^™ ^"^ ^^^ Carrying on of certain paint-works as dered to deliver agent to Mr. Knowlys, whose property they then clearly were), the owner : Held, that though an act of bankruptcy might have been committed previous to the demand for the goods, the owner, not having had notice, was entitled to the goods. IN BANKRUPTCY. 239 should remain on these premises, and be used by Pritchard in 1852. the manufacture by him of certain paints, on his own sole account, for one year, from the 1st of June, 1850. Mr. Pmtohaed, Knowlys died in October, 1850, and probate of his will was ^owuia. granted to his widow, Mrs. Knowlys, on the 19th of February, 1851. The filing of the petition for adjudication in this bankruptcy was on the 11th of November, 1851. On the 7th of November, 1851, Mr. Clare, a solicitor, acting under instructions from Mrs. Knowlys, called at the bankrupt's premises for the purpose of demanding the possession of the chattels in question, but did not see the bankrupt, he not being there, but saw some clerks, and spoke to one of them, who was represented to him as the book-keeper, and he informed him that he came to demand possession of these chattels on behalf and as the property of Mrs. Knowlys, as her husband's executrix, and was told, in answer, that the bankrupt not being there, they had no authority to deliver them up. Mr. Clare went a second time on the same day, and again asked for the delivery of these chattels, and received the same answer ; and went again on the 10th of November, to repeat the demand, but found the place locked up. Some doubt has been entertained whether an act of bank- ruptcy was committed by Pritchard prior to the 7th of No- vember, 1851, and consequently, whether the demand on that day for the delivery of these chattels was before or after an act of bankruptcy by Pritchard ; but it was admitted that Mrs. Knowlys, or her agent, had no notice of an act of bankruptcy, either before or after such demand. JUDGMENT. The first point for consideration is, whether the demand made by Mr. Clare on behalf of Mrs. Knowlys, on the 7th of November, was sufficient to take these chattels out of the possession, order, and disposition of the bankrupt, by the consent and permission of the true owner, according to the 125th section of the Consolidation Act. The case of Smith 240 REPORTS OF CASES 1852. V. Topping, 5 Bam. & Add. 678, appears to be a direct ~ authority that such a demand was sufficient for such purpose. Peitohabd, In that case there was a similar demand made of the clerk of iSotvxys. t^6 bankrupt in his absence, who refused to deliver up the chattels ; and again on the same day the bankrupt himself was required to deliver them up, but he also refused to do so. This demand appears to have been made before the act of bankruptcy as well as before the issuing of the commission. It was held to be clear, that after the demand upon the clerk, the goods were no longer in the possession of the bankrupt with the consent of the true owner, and judgment was given in favour of the plaintiff claiming these goods of the assignees. If, therefore, there was no act of bankruptcy prior to the demand made by Mr. Clare, in this instance, on the 7th of November, it would follow that the assignees would have no right to these chattels. But as it is not clear whether an act of bankruptcy was committed by Pritchard before or after the 7th of November, it becomes necessary for me to consider whether, if an act of bankruptcy had been committed before that period, such circumstance would affect the rights of the parties, Mrs. Knowlys or her agent having no notice of any such prior act. The early authorities on this subject have certainly laid down the position, that the words " at the time he becomes bankrupt," used in the stat. 21 Jac. 1, c. 19, and also in the 6 Geo. 4, c. 16, s. 72, applied to the act of bankruptcy, and not to the date of the commission or fiat. But since the stat. 2 & 3 Vict. c. 29, a contrary view of this question has been taken, where the owner had not notice of a prior act of bankruptcy ; and the regaining of the possession of the goods before the fiat, although after a secret act of bankruptcy, has been considered to be a transaction protected by the latter statute, the enactment in which, it is to be observed, is adopted in the same terms in the 133rd section of the late Consolidation Act. The cases in which this latter view of the question has been taken, and which have been cited in 15 BANKRUPTCY. 241 the argument on this case, are, first, Pariente v. Pennell, 1852. 2 Moo. & Rob. 517, where goods had been assigned before an "~^ act of bankruptcy, but possession was not taken by the Pritohabd, COS 7icuri/Q assignee until after such act, but without notice of it, and knowlts. before the date of the fiat ; and it was there held, that the assignee had no right to the goods, the taking possession before the date of the fiat being held to be a transaction pro- tected by the 2 & 3 Vict. The next case referred to is Ex parte Styan, decided by Lord Lyndhurst on appeal, and reported in 2 Mont. D. & D. G. 210, in which a life policy had been deposited by the bankrupt before an act of bank- ruptcy, but notice of the deposit had not been given untU after such act, of which act the depositary had no notice ; and his lordship held, that the deposit and the notice of it con- stituted a transaction protected by the 2 & 3 Vict. The other case on the subject is Young v. Hope, in 2 Exch. Rep 105, which was very similar to the present. There the bankrupt took possession of goods of another person, under an agreement that he should keep the possession of them for one year, on payment of a certain sum at a certain period, and that in default of such payment, the owner should be at liberty to retake them. Default was made, and the owner, after an act of bankruptcy, of which he had no notice, but before the fiat, re-possessed himself of these goods, and sold them. This was also held to be a transaction within the 2 & 3 Vict. In this case the previous authorities were fully dis- cussed, and amongst them is that of Fawcett v. Fearne, 6 Q. B. Rep. 20, which appears to have laid down a contrary doctrine, and to have decided that the 2 & 3 Vict. c. 29, made no difierence as to the operation of the provision in the bank- rupt laws respecting goods in the reputed ownership of the bankrupt. But it was considered by the judges who decided the case of Young v. Hope, that Fawcett v. Fearne was not in point, inasmuch as there the goods came into the possession of the bankrupt for the first time after the act of bankruptcy, and before the fiat, and that the 2 & 3 Vict, had no relation 242 EEPOETS OF CASES 1852. to such a case, but only rendered valid particular transactions before invalidated by the rule of relation to the act of bank- Re Pkitchaed, ruptcy. This case of Fawcett v. Fearne, which appears to :^om?s ^^ ^^ °^y °^^ opposed to the construction of the 2 & 3 Vict, before adverted to, being thus distinguished from the other cases cited, and at all events having been considered not to mihtate against them, these authorities must, I think, be viewed as decisive upon the subject, particularly that of Young v. Hope, which appears to me to remove all ground there might have been for contending that the cases of Pariente v. Pennell and Ex parte Styan were not in point, on the ground that the respective acts of taking possession of the goods and giving notice of the deposit of the policy were only acts done for perfecting the assignment and deposit respectively made before an act of bankruptcy, and therefore formed part of the respective transactions which occurred before any such act. But in this case of Young v. Hope, the taking possession after the act of bankruptcy was a transac- tion distinct from and independent of the delivery of possession made before that act, and was alone treated as a transaction within the 2 & 3 Vict. Upon these authorities, therefore, and taking into con- sideration that the intention of the Legislature latterly has been to diminish the severe effect of the relation to the act of bankruptcy, and to extend the protection given to bond fide transactions with traders, I think that the demand in this instance of the chattels on behalf of Mrs. Knowlys, which, as I have before shown, was tantamount, under the circumstances, to the actual taking possession of them, must be held to be a transaction protected by the 133rd section of the Consolidation Act, although such demand may have been made after an act of bankruptcy ; and that, consequently, the assignees have no claim to these chattels, but must deliver them up to Mrs. Knowlys, as her late husband's legal personal repre- sentative. IN BANKRUPTCY. 243 1852. (Before Mr. Commissioner Fane.) TT Pnday, Be Mat, ew parte Hawley. nov. u. X HIS case was brought under the consideration of the Attorney's Court under the following circumstances : — mortgagee * The bankrupt, May, had a leasehold interest in certain <'°^*^- ,, ^ ' •' An attorney premises situate at Newington, Surrey, the title-deeds re- holding deeds lating to which were at the time of the bankruptcy in the in his custody, possession of May's (the bankrupt's) solicitor, who claimed the*adiudioa-^ to have a lien on the deeds in respect of his general bill of t'on, has » • 1 1 general lien costs against the bajikrupt, and also as equitable mortgagee thereon for in respect of his having indorsed certain bills of exchange as aervfces?"* surety for the account of the bankrupt. The validity of this Abankrupt's ■' r J attorney hold- claim being disputed by the assignees, it was arranged that ing title deeds the bankrupt's interest in the property should be sold, and rupt without that the produce received by the official assignee to be held ^g^^^^um subject to the solicitor's claim : and that the claim should cannot sustain a claim as equi- be disposed of by the commissioner, under the 12 & 13 table mortga- Vict. c. 106, s. 12. orsudideTd?* against the oath of the FooJcs, counsel, for the claimant Hawley, relied upon an bankrupt. affidavit made by the claimant, in which he stated that he claims lien for had acted as solicitor for the bankrupt, and that the deeds in ^g*t'o*°u^gtaii" question had come into his hands in the course of such em- tis case as 1 ■ jr !_■ equitable mort- ployment ; and that a sum of 48/. was due to him for his gagee entitled professional services rendered to the bankrupt ; and that he ceedings°to^™ had, for the accommodation and at the request of the bank- substantiatehis ' _ ^ _ claim without rupt, indorsed bills for him to the amount of 250/., which had apportionment, been given by way of security for money lent to the bankrupt, the bankrupt having agreed that the solicitor should hold and have an equitable hen on the deeds in question, in order to indemnify him against his liability on the bills. Bagley, counsel, for the assignees, admitting that an attor- 244 REPORTS OF OASES 1852. ney's lien for professional services conld not be successfully disputed, contended that an attorney has not a lien for debts Mat, due aliunde, as for money lent ( Worrell v. Johnson, 2 Jac. Hawmt. ^ Walk. 218) ; and that the solicitor's lien in this case should be confined to charges purely professional ; and also contended that his claim to stand as equitable mortgagee was answered by a previous examination of the bankrupt appear- ing on the file of the proceedings under the petition, wherein the bankrupt had stated that the deeds were in the possession of his solicitor as such simply ; and distinctly stated that no arrangement or understanding was ever come to between him and the solicitor in question, that the deeds should be held by the solicitor as security against any claim he might have against the bankrupt, or that the solicitor had any lien on the deeds ; and contended that, there being conflicting testimony, and there being no other memorandum conferring a lien upon the solicitor as equitable mortgagee, the bankrupt should pre- vail. (Ex parte Martin, 2 Mon. & Ayr. 243 ; 4 Deac. & C. 457.) Fooh, in reply. — An equitable mortgage may be created by a deposit of deeds and verbal agreement. The examina- tion of the bankrupt should not be allowed to prevail against the deposition of Hawley, on the ground of the examination of the bankrupt having been ex parte, so far as the solicitor was concerned, the same having been taken in his absence, and consequently without his having had the opportunity of cross-examining the bankrupt ; and the adjournment was asked on the part of the solicitor for the purpose of procuring the attendance of the bankrupt and his cross-examination. Mr. Commissioner Fane. — No sufficient grounds are shown for any adjournment. The affidavit of Mr. Hawley is as much an ex parte proceeding as that of the bankrupt, as re- gards this matter. These statements, as to the circumstances under which the deeds in question were held by Hawley, are IN BANKRUPTCY. 245 difficult to reconcile ; and I should have felt great difficulty 1852. in determining which statement is most entitled to credit, if j^ I considered myself called upon to do so. The principle laid Mat, down hy Sir George Rose, in the case to which I have heen Hawlet. referred hy Mr. Bagley, has my concurrence, and I shall act upon it in this case. The deposit of deeds is an equivocal act, and if the party with whom they are deposited will not take the ordinary precaution of getting a few lines, signed by the party depositing, stating upon what terms the deposit is made, he places himself at the mercy of the bankrupt ; and if the bankrupt swears the deeds were not deposited as security, the Court ought not to give effect to a contradictory state- ment on the part of the claimant. If this principle is applicable in any case, it is especially so where the party claiming to hold as equitable mortgagee, was himself the soli- citor of the bankrupt, and admits that he became possessed of the deeds in the first instance as soHcitor. The sohcitor in this case may have the amount of his bill for professional business done for the bankrupt out of the proceeds of the sale of the property to which the deeds relate ; but I disallow his claim as equitable mortgagee in other respects. Fooks asked for the costs of the proceedings taken on the part of the solicitor for establishing his claims. Bagley, contra, on the ground that the claim had failed to some extent. Mr. Commissioner Fane. — It is not merely by reason of the claimant having asked for more than he has been able to establish, that he should not have his costs, and the costs not appearing to have been increased in any material degree by bringing forward that portion of his claim, on which he has failed. I shall aUow him his costs generally. Order accordingly. 246 REPORTS OF CASES 1852. Mr. Commissioner Fonblanque. — Where a creditor has proceeded simultaneously at law by issuing a writ, and in Mat, bankruptcy by a trading debtor's summons, and the debtor ^^^ ^^ immediately paid the debt and costs at law, the Commis- Wednesday, gioner refused to make any order as to costs in bankruptcy. Dec. 3rd. (Before Mr. Commissioner Ellison.) Dec. m. Be Atkinson. Order for sale ThE facts of the caso, to wMch litigation has given some of goods on dis- celebrity, may be shortly stated. Atkinson kept the Charles the bankrupt ; Twelfth inn, at the Bridge-end, Newcastle. On the 30th of "a perso°n ' August, 1850, he committed an act of bankruptcy, by depart- o^r°l,r*°8^e- ^^S ^°^ ^^ dwelling ; and on the 9th of September following, able consider- a petition for adjudication was filed, on which he was duly perty, in the adjudged bankrupt. In the mean time, and on the 3rd of sitionof th?" *^^* month, Mr. Heslop, a spirit-merchant at Darlington, to bankrupt, whom the bankrupt had some years before granted mortgages, 125, and hav- with power of Sale of the stock, furniture, and effects he then afterthe act of possessed, but of which he had nevertheless allowed the and'befor'''''tli ^^'ii^rupt thenceforth to continue in possession, hearing that petition, if he Atkinson had absconded, came to Newcastle, and put a man has notice of. . «,. -i/. tiv the act of m possession of his stock, fixtures, and efltects. Mr. Heslop does ^t*there- ^^^ ^°*' ^^^^ ^^^^ P^^ ^^ ^^^ property, and on Atkinson being by obtain the declared bankrupt, the messenger displaced the adverse pos- the 133rd sec- SBSsor, and the assignees of their own authority sold the whole prive this Court of the effects by private contract, and paid the proceeds into order u^^b*" *^® Court of Bankruptcy, where they remain. An action of sold for the be- trover was thereupon brought against the assignees by Mr. estate. Contrd., Heslop, which was tried at the last Spring Assizes at New- iXe^^ '""'' ^'^tle, before CressweU, J., when the jury found that the Although goods in question were in the reputed ownership of the bank- such goods are already sold by the assignees, there is property for the order to operate upon, and such sale is no objection to the Court making the order. Circumstances under which the Court will make such an order. IN BANKRUPTCY. 247 rupt at the time of his bankruptcy, with consent and pennis- 1862. sion of the plaintiff, and a verdict was found for the defend- ~ ants, the assignees, accordingly. The plaintiff's counsel, Mr. Atkinson. Bliss, then objected that the Bankrupt Law Consolidation Act, 1849, sec. 126, had rendered necessary an order of the Commissioner to authorize assignees to sell property so circum- stanced, and this objection being reserved by the learned judge, came to be argued before the Court of Exchequer in June last, on a motion for a new trial. That Court held the objection good, and awarded a new trial accordingly. The assignees were thereupon advised that they should apply to the learned Commissioner for an order under the 125th section, as if the sale yet remained to be made, and that such order, if obtained, would, by relation, give a valid title. The appli- cation for that order was heard on the 29th of October last, when the plaintiff and witnesses were examined, and his solicitor then objected that such order should not be made, for three reasons, which (stated shortly) were — ^first, that as the goods had been already sold, there was no property for the order to operate upon, and that the fact of the sale having been made was a reason why this Court should not now make the order ; secondly, that even if this Court ought to make the order in any case after the sale of the property intended to be affected by it, no such order should be made in this case, inasmuch as the seizure by Mr. Heslop was a transaction within the meaning of the 133rd section of the Bankruptcy Act, which section related to transactions not affected by bankruptcy, and rendered valid executions levied by seizure and sale before the petition, notwithstanding a prior act of bankruptcy, provided the creditor had not, at the time of levying or making sale, notice of a prior act of bankruptcy ; and thirdly, that, supposing those objections to be overruled, the Court should not, under the circumstances of this case, exercise its discretion to make the order prayed. Mr. Commissioner Ellison took time to consider his judg- 248 REPORTS OF CASES 1852. ment, the point being new and important, and caused mt- nesses to be examined to-day on the question whether Mr. Atkinson. Heslop had notice of the act of bankruptcy when he entered ; and now proceeded to give an elaborate judgment, in which (after recapitulating the facts, and the matters objected, as already stated) his Honour, taking the second objection first, traced the doctrine from the earliest statute to the present time, showing the gradual relaxation of the severity of that doctrine in favour of persons dealing with the bankrupt, and the final substitution of the time of the fiat for that of the act of bank- ruptcy. His Honour then took a like review of the parallel provisions made by the statutes relating to property in the reputed ownership of the bankrupt, and pointed out the pre- servation by the Legislature of the provisions relating to property so circumstanced, through all the statutes relating to the law of bankruptcy, from the 13 Eliz. down to the Act of 1849, without modification. The learned Commissioner then reviewed the reported decisions as to the circumstances under which the property of another, of which he left the bankrupt in possession and reputed ownership, had been held to pass to the creditors generally, and pointed out the distinction which appeared to him to exist between the two sets of provisions — between the property and transactions contemplated by the ISSrd section, which related to the property of the bankrupt only, and the property of which the real owner had uncon- scioimly, as the law supposed, allowed the bankrupt to remain in possession. He then noticed the cases decided before the Consolidation Act, which showed that there was no alteration of property in goods by seizure only ; that seizure and sale were necessary to give an execution creditor a property in the bankrupt's goods, and said, that even if the protection of the 133rd section could have been effectually claimed in the case of property liable to the doctrine of reputed ownership, Mr. Heslop could not claim it at law, for his alleged title had not acquired the support of sale as well as seizure, and his entry was clearly to the mind of him (the Commissioner), as it had IN BANKRUPTCY. 249 been to that of the jury, with notice of the act of bankruptcy. 1852 His Honour then said that, in the absence of express autho- "~r rity to the contrary, he should have had no hesitation now in Atkinson. deciding that the seizure and even sale by the person claiming to be true owner of a bankrupt's property, in his reputed ownership, could not deprive the Court of Bankruptcy of the power to order it to be sold. But the case of Ex parte Sty an, 1 Phill. 105, and the case of Pariente v. Pennell, 2 Moo. & Rob. 517, in which the doctrine laid down by the Lord Chancellor Lyndhurst in the former case had been fol- lowed by Lord Chief Justice Tindal, had struck him, while considering the present application, as authorities for the proposition that a person claiming to be real owner for valu- able consideration of property, within the meaning of sec. 125, might, by an act done after the act of bankruptcy and before the petition, deprive this Court of the power to order it to be sold for the creditors; or, in other words, might obtain the protection of the 133rd section, provided he had not notice of the act of bankruptcy. The decision in Be Styan, if that be the effect of it, woidd, of course be blading on this Court ; and it had, therefore, appeared to him necessary that he should have evidence on the point of notice ; the result of that evidence was to satisfy him that Mr. Heslop had notice of the act of bankruptcy when he entered on the 3rd of Sep- tember. His Honour then proceeded to advert to the first objection which had been urged by Mr. Heslop's solicitor, and said his decided opinion was, that he was bound to make the order notwithstanding the sale of the goods by the assignees ; and, as to the third objection, without deciding whether he had a discretion to exercise his power to make the order or not, he was satisfied that he was now dealing with precisely the case to which the doctrine of reputed ownership had been always held applicable — it was a case within the very words of the early statute of the 11th James, that of an owner who had allowed the bankrupt to remain in possession of his property as reputed owner, and to obtain credit on the s 250 REPORTS OF CASES 1852. faith of it. For these reasons he was bound to overrule the objections which had been submitted to him, and to make Atkinson, the order now prayed by the assignees. Tuesday, Jam. Wth. Certificate. Sec. 201. On certifi- cate, dealing in foreign stock and railway shares held not to be within sec. 201 of the Bankrupt Law Consolidation Act, but such dealing held to be reckless trading under the circum- stances. Cer- tificate sus- pended. (Before Mr. Commissioner Evans.) Be Btjckland. 1 HIS was an application by the bankrupt for a certificate, which was opposed on the grounds that the case came within the 201st section of 13 & 14 Vict. c. 106 (Bankrupt Law Con- sohdation Act), and also that he was guilty of reckless trading. Lawrance, solicitor, for bankrupt. — (WeUs y. ParJcer, 3 Scott, 141 ; Oakley v. Byley, ib. 194 ; Elsworth v. Cole, 2 Mee. & Wels. 31 ; Bohson t. Fellows, 2 Bing. N.C. 332.) JUDGMENT. In support of the first section it was admitted by the bankrupt that he had lost within a year before his bank- ruptcy more than 200?. in contracts for the purchase of Peruvian bonds, and also more than 200/. in the purchase of railway shares, and that such contracts were not to be per- formed within one week after the contract, and that the stock and shares were not actually transferred or delivered in pur- suance of such contract. It was contended, on behalf of the bankrupt, that the Peruvian bonds, being foreign stock, were not within the word "stock" in the clause referred to, and many cases were cited proving that, under the 7 Geo. 2, c. 8, similar words were held not to include foreign stock. I have looked at those cases, and they establish that point. I had considerable doubt as to whether the 201st section could be considered as similar to the 7 Geo. 2, c. 8 ; 13 & 14 Vict, c. 106, s. 201. " That no bankrupt shall be entitled to a certificate of conformity under this Act ; and any such certi- ficate, if allowed, should be void if such bankrupt shall have lost by any sort of gaming or wagering in one day twenty pounds, or within one year next preceding the issuing of the IN BANKRUPTCY. 251 fiat or filing of the petition for adjudication of bankruptcy 1862. 200/. ; or if he shall within one year next preceding the issuing of the fiat, or the filing of such petition, have lost Buokland. 200/. by any contract for the purchase or sale of any govern- ment or other stock where such contract was not to be per- formed within one week after the contract, or where the stock bought or sold was not actually transferred or delivered in pursuance of such contract." In stat. 7 Geo. 2, c. 8, the words are "public or joint stock, or other public securities whatsoever ;" but I find that the opinion of the majority of the commissioners is in favour of such construction ; and as the clause is highly penal, I think I ought to decide in favour of the bankrupt on this point. I understand that shares are not considered as stock at the Stock Exchange, and conse- quently they do not come within the 201st clause. But although I decide that the case does not come within the 201st clause, I am of opinion that the bankrupt has been guilty of reckless trading ; that he has traded to the extent of thousands when he had no capital to meet losses. To trade when a man's creditors must necessarily bear the loss and he keep the gains, is most unjust : the frequency of such conduct is no excuse, but proves the necessity of visiting it with severity when proved. I, therefore, shaU suspend the bankrupt's certificate for one year; to be of the second class. (a) No fraud.- — Protection. (Before Mr. Commisaioner Ateton.) Anonymous. 1851. Oct. 21s«. i HIS was a trader debtor summons. The defendant was a under a trader coal-owner, selling; his own coals. '^®''*°L^i"?" ' ° mons (78 & following sec- Bond, for the defendant, contended the summons must be tions of 12 & ISVict. 0.106), (a) But see Expa/rte Matheson, 1 De Gex. & M'N. 48. the Commia- • sloners can in- quire whether the person summoned is a "trader" subject to bankruptcy. A coal-owner is not such a trader. s 2 252 EEPORTS OF CASES Anontmous. 1851. dismissed, the defendant not being a trader subject to the Bankrupt Laws. (^Port v. Turton, 2 Wils. 168. And see Ex parte Gardener, 1 Rose, 377 ; Ex parte Burgess, 2 Gl. & J. 183 ; Ex parte Atkinson, 1 M. D. & D. 300.) And the Commissioner can entertain the question whether the person summoned is such trader. (See Bryan v. Child, 5 Ex. 368.) Blackburn, contra. — This objection can only be taken if an attempt is made to declare the defendant a bankrupt. Mr. Commissioner Ateton. — In this case there are two points : first, ha've I a power to inquire whether or not this defendant is a trader subject to the Bankrupt Laws ? and if I have, then, secondly, is he such a trader ? As to the first point, sec. 78 enacts, that if any creditor of any such trader shall file, &c., the Court may issue a summons and proceed thereon. " Such trader" means a trader subject to the Bankrupt Laws, and if the defendant is not so subject, I have no jurisdiction. Before, therefore, I take any further step, I ought to ascertain that the defendant is within my jurisdiction, otherwise the proceedings would be coram non judice. This brings me to the second question, which is, whether the defendant is a " trader." No afiidavits are filed, the facts being admitted. The fact, then, is, that the defendant is a coal-owner, that is, a gentleman who works his own coal-mine, and sells the coal ; one, therefore, who does not both buy and sell coal ; one who did both would be a coal- merchant, not a coal-owner. Under the old law, great doubts, to say the least of it, existed as to whether coal-owners, lime- burners, alum-makers, and brick-makers were traders, subject to the Bankrupt Laws : the present statute expressly declares all of them to be traders, except coal-owners, as to which the statute is silent ; which is an argument against their being traders. The general words, " by workmanship of goods and commodities," would more strongly have applied to a brick- Anonymous. IN BANKRUPTCY. 253 maker, who digs up clay, but sells a manufactured article, — 1851. bricks ; still more to an alum-maker, wbo takes up aluminous clay or slate, and sells a crystallized manufactured substance called alum ; yet these instances were not within those general words, or they would not have been inserted by name : clearly, then, a coal-owner is not within those general words, as all he does is to dig up and bring up to the surface his own coals, and sell them. This summons therefore must be dismissed. Be Wilson. Monday, Nov. nth. \_;AEISS, for the bankrupt, moved that the proceedings clerical errors after adjudication be set aside, in consequence of no duplicate fn theXplkate of such adjudication having been served upon the bankrupt, adjudication served on the as required by sec. 104 of 12 & 13 Vict. c. 106, which bankrupt do enacts, " that before a notice of any adjudication in bank- proceedings ruptcv shall be gdven in the London Gazette * * * * a after adjudioa- ^ •' ° _ tiou null and duplicate of such adjudication shall be served on the person void, adjudged bankrupt." Now, in what is called the duplicate, said to be served on the bankrupt, there is a blank where there ought to be the month " October," and the figure " 1" is opiitted in the year "1851." Then the name of the solicitor is erroneously written on the back of the duplicate. Ford, for the petition, contra. Mr. Commissioner Atrton. — The copy of the adjudication served is defective, as Mr. Cariss states ; therefore it is not, in fact, a duplicate. But the object of sec. 104 is, that the bankrupt may have full notice of the adjudication, in order that he may, if expedient, appear within seven days, and dispute such adjudication. In this case, the bankrupt does not wish to dispute the adjudication, but contends that all 254 EEPORTS OF CASES 1851. Re Wilson. done since is null and void. If, indeed, the bankrupt had held himself aloof from the Court, and when written to by the official assignee, had answered, "What do you mean by writing to me ? I know nothing about what you allude to," he might have placed the petitioning creditor in a difficulty. But the bankrupt now appears by his solicitor in court, and thereby admits that he very well knows what is going on; and he has not taken, nor does he now take, any objection to the adjudication itself I do not think the omission of " October" and " 1" fatal to aU subsequent proceedings, so as to render them absolutely null and void ; and in point of equity, no injury has been done, nor will any accrue to the bankrupt by these clerical slips : the object of the clause is satisfied ; the bankrupt has had notice of the adjudication, which he does not dispute, and his appearance here this day cures the blot. I therefore do not perceive any reason for my interfering to stay proceedings. Monday, Dec. \st. A petition un- der see. 211 of the Bank- rupt Act will not neceRsarUy be dismissed, because part of the assets con- sists of mort- gaged pro- perty. Anonymous. X HIS was the first private sitting under the private arrange- ment clauses of the Bankrupt Act (sec. 211 and following clauses). The debtor filed a balance-sheet, setting forth his property to consist of : — £. s. d. Household furniture 58 Stock in trade and fixtures 68 Two houses upon which the Equitable Building Com- £. s. d pany have a claim for .. . 614 Cost value 750 Presentvalue 136 Assets 262 Debts accruing 486 IN BANKRUPTCY. 255 Anonymous. Barwick, for a creditor who objected to the arrangement, 1861. contended the petition must be dismissed, as the affidavit (schedule B, 6) deposes, " this deponent hath assets readi/ to be produced to this honourable Court, to the value of 200?. and upwards ;" but part of this consists of mortgaged pro- perty, which is not " assets ready to be produced," it having been decided by the Commissioners that book-debts are not such assets, nor a reversionary interest, (a) Mr. Commissioner Atrton. — I see no reason to charge the petitioner with bad faith. Do you contend that this affidavit is " wilfiilly" untrue under sec. 223 ? BarwicL — I do not so contend, but I say that the founda- tion for the whole proceeding fails, in like manner as if under a bankruptcy the debt of the petitioning creditor is defective. I contend that this petition ought to be dismissed. Mr. Commissioner Ayrton. — In the cases cited, the peti- tioners were adjudged bankrupts under sec. 223, no doubt, because " the affidavit filed with the petition was wilfully untrue, so far as concerned the assets ready to be produced by him." In the present case, it is not contended that the affidavit is "wil/uUif" untrue, nor do I see any reason to suppose that it is so : this case, therefore, is not within the principle of those cited. Mr. Barwick, indeed, does not ask that the petitioner be " adjudged bankrupt," but he asks that I should dismiss the petition ; but the early portion of sec. 223 points out three cases in which the petition is to be dismissed, and the error of the petitioner in describing his property in this case is not one of them. I therefore think I ought not to dismiss the petition, but leave the matter in the hands of the creditors now assembled, to approve, or not, as they think fit, of the proposition made to them by the petitioner : if that proposition be not assented to, then by this 223rd section, I am directed to declare the petitioner a bankrupt. (a) Anon. sup. p. 15. 256 REPORTS OF CASES 1-851. Bee. ind. Anonymous. The Court of A. TRADER debtor summons issued under sec. 78 of can°rehear''an t^e Bankrupt Act ; it was served on the 15th of November ; application un- ^^ ^j^g 25th, the defendant appeared, and filed an affidavit of der a trader ' rr ' debtor sum- a good defence ; the plaintiff asked for a bond, but after hearing the evidence of the defendant on oath, that was refused. On the 27th of November, the plaintiff filed an affidavit showing that the defendant had sworn falsely, whereon the Commissioner allowed notice for a rehearing to be given for this day. Cariss, for the defendant, contended that the Commissioner having made an order, his power was gone ; and even if the matter could be reheard, yet no bond could be ordered, as sec. 79 says, the Commissioner may " at the same time," that is, the day of hearing, direct a bond to be given. Bond, for the plaintiff', contended in favour of the Court of Bankruptcy possessing the same power to rehear a case as all Courts, and he cited Ex parte Lancaster Canal Company, 1 Dea. & Ch. Mr. Commissioner Ayrton. — Though sec. 79 uses the words " the same time," yet sec. 80 refers to "any enlarge- ment thereof," and sec. 83 expressly enables the Court to enlarge the time ; and the whole of the sections under the head of "Acts of Bankruptcy by nonpayment after sum- mons" are to be read together. As to the power to rehear. By sec. 6, the Court of Bankruptcy is a court of law and equity — a court of record — and has aU the powers, rights, incidents, and privileges of a court of record, as fully, to all intents and purposes, as the same are used and enjoyed by any of her Majesty's courts of Anonymous. IN BANKRUPTCY. 257 law or judges at Westminster. By sec. 12, the Court, in 1851. the exercise of its primary jurisdiction, shall have superin- tendence and control * * * * in any other matter (whether in bankruptcy or not) where the court, by virtue of this Act, has jurisdiction over the subject of the * * * * application. Now, it is a right inlierent in all courts to rehear a matter : in courts of law this is called a new trial ; in courts of equity, a rehearing. The Court of Bankruptcy is a court of law and equity. Sec. 207 assists in proving that this Court has a general power to rehear, for that section enacts that the decision of the Court touching the certificate shall be final and conclusive, " and shall not be reviewed by the Court," except under certain circumstances : this restrictive clause proves, that, in the absence of the restriction, decisions touching the certificate could have been reviewed on any ground. In this case, the evidence on the 25th of November was all on one side, so that it would be in vain to appeal ; the consequence of which is, that unless I can rehear the matter, the plaintiff will be deprived of his remedy, though he alleges fraud and perjury on the other side. Not to rehear, there- fore, would be to run counter to the maxim, boni judicis est ampliari jurisdictionem, which Mr. Broom properly trans- lates, it is the duty of a judge, when requisite, to extend the limits of his jurisdiction. " The maxim of the English law," says Lord Abinger, in Riissell v. Smith, 9 M. & W. 818, " is to amplify its remedies, and without usurping juris- diction, to apply its rules to the advancement of substantial justice." I therefore am of opinion that I have power to rehear this case, and that the affidavit filed on the 27th furnishes a prima facie case for rehearing. I therefore shall rehear the case. Some evidence was then given by the plaintiff's witnesses, when Cariss interposed, and admitted his client could not resist giving a bond. 258 REPOHTS OF CASES 1851. Whereupon the former order was discharged, and an order made to enlarge the time for seven days, to enable the defendant to enter into a bond, which he was ordered to do. Anonymous. Be AsHTON. Dec. nth. -. _ Goods sent on IVlESSRS. APPERLY Sent certain pieces of cloth to the nora^hiaUyde- ^^-i^^ript) on Sale or return, accompanied by a letter and liyered at the invoice, both of which were received by the bankrupt before time of bank- . ■,. . , , t t i • i •, ruptcy, are not the adjudication : the cloths did not amve at the railway ownersHp^of Station at Hull till after the adjudication. The messenger the bankrupt, geized the goods at the railway station at Hull. Messrs. Apperly applied to the Commissioner to order the cloth to be delivered to them, which was resisted by the assignees, on the ground that the delivery at the railway was delivery to the bankrupt, and the cloths were consequently in the reputed ownership of the bankrupt. The Commissioner took time to consider his judgment, which was now delivered. Mr. Commissioner Atrton. — The statutory enactment now in force is to be found in the 125th section of the Bank- rupt Act of 1849. It is to be noticed, that the statute of James 1 used the word "and" — "in his possession, order, and disposition;" whereas sec. 126 has the word "or," — " in his possession, order, or disposition" — which consider- ably enlarges the operation of the law of reputed ownership. In the present case, the goods in question were not within that portion of the clause which speaks of the bankrupt as being the " reputed owner," for no one ever saw the goods in his possession ; nor had he " taken upon him the sole order or disposition." All that remains to consider is, whether he had, at the time he became bankrupt, these goods in his pos- session, or in his order, or at his disposition. Messrs. Apperly contend that these goods were not, in fact, ever delivered to the bankrupt, or to his agent, the car- IN BANKRUPTCY. 259 riers, the Railway Company; it has not been clearly ascer- 1851. tained on what days the goods arrived at and left Binning- ~~ ham, to which place Messrs. Apperly paid the carriage, and Ashton. from which place the bankrupt was to pay the carriage ; but I intend to decide this question on the broad ground of whe- ther these goods, sent on sale or return, and not accepted by the bankrupt, are within the law of reputed ownership. Upon looking into the reported cases, I find three decisions applicable to the particular question of goods sent on sale or return. The first case is Neate v. Ball, 2 East, 117 ; there, bags of wool were sent on sale or return, on the 19th of February, and kept by the bankrupt till the 6th of March, when, finding himself insolvent, he, for that reason, returned the wools, which were held by Lord Kenyon to be in the re- puted ownership ; his Lordship observing, " The jury were told by me that if the goods were not delivered to and accepted by the bankrupt, there was an end of the question, and the property remained in the hands of the consignors ; but if otherwise, the bankrupt had no power to rescind the contract when he returned them." The next case is Livesay v. Hood, Camp. N. P. 83. The marginal note of the case is, that goods in the hands of a retail dealer, on sale or return, are in the reputed ownership : the facts, however, are of too peculiar a nature to establish that general proposition. Livesay, a wholesale hosier, agreed to famish Almond, a retail hosier, with goods on sale or return ; Almond was constantly to have a stock of hosiery from Livesay, to the value of 100/., which he was to sell, and the parties were to come to an account monthly. Almond became bankrupt, the assignees seized goods supplied under this agreement worth 61/. ; then Live- say brought an action to recover the goods, but was non- suited, Mr. Justice Lawrence saying, "This is a case within the statute ; under this agreement, the bankrupt was to sell the goods, not as a factor, but as a principal ; they appeared as his property ; and this reputed ownership was calculated to give him a delusive credit, which was the object of the sta- 260 REPORTS OF CASES 1851. tute to prevent." The third and last case is that of Gibson V. Bray, 8 Taunt. 76. Shawls and laces were sent by Mor- AsHTON. gan, of London, to Markham, of Sunderland, accompanied by a letter hoping that some of the articles would be approved of, and desiring to have those articles which were not ap- proved of returned as soon as possible : on the evening of the day of the arrival of the goods at Sunderland, the effects of Markham were seized under z.fi.fa. and on the following morning, the sheriff shut up the shop, which was not ever re- opened. An action was brought for these goods by Morgan against the assignees of Markham, who had become bank- rupt. At the trial before Chief Justice Gibbs (1 Holt, N.P. Cases, 556), his Lordship directed a verdict for the plaintiff, on the ground that the goods were in the reputed ownership ; afterwards, however, a new trial was moved for, and ordered (8 Taunt. 76), the Court being of opinion that the goods were not in the order and disposition of the bankrupt. Mr. Jus- tice Dallas said, " The bankrupt had not had a reasonable time wherein to judge what he would or would not take." Mr. Justice Parke said, " We impugn not the cases of Neate V. Ball, and Livesay v. Hood. Markham had never any opportunity of exercisiug the discretion delegated to him, as to the selection of what goods he should keep, or what he should return ;" — " there is no pretence for saying that a de- lusive credit could be raised. In Neate v. Ball, the bank- rupt kept the goods from the 19th of February to the 4th or 5th of March ; in Limsay v. Hood, the goods had been in possession of the bankrupt for nearly a month ;" and Mr. Justice Burrough observes, " The key to this case lies in the postscript to the letter, — ' shall be very much obliged to have them returned, what is not approved, as speedily as you can.' It is quite plain that Markham was to have a reasonable time to choose whether he would have all the goods or a part of them only ; he had not a reasonable time in which to exer- cise his power of choice, nor did he exercise any power over these goods." IN BANKRUPTCY. 261 The case of Gibson v. Bray is quite a precedent to govern the present ; I may use almost the very words of Mr. Justice Burrough. The key to this case is that the bankrupt was to he allowed a reasonable time to choose whether he would take all the cloth, or select only a portion, or reject the whole ; he never had any oppportunity of exercising this power, and he never accepted the whole, nor any part of the cloth ; he never did exercise any sort of control over the cloth, and there is no pretence for saying that any delusive credit was raised. I am, therefore, of opinion that the cloth in question was not in the reputed ownership of the bankrupt, and must be delivered up to Messrs. Apperly. 1851. He ASHTON. 1852. Ex parte Ltjxfoed, re Luxpord. i HIS was a petition by the bankrupt to annul the adjudica- tion with the consent of all the creditors who had proved. The bankrupt had not passed his last examination. Bond, for the petition, stated that this petitioner could pay perhaps sixty shillings for every pound he owed, and knowing that, neglected a trader debtor summons, and so committed an act of bankruptcy. March %th. There is no ju- risdiction to annul with con- sent of credi- tors, save un- der sec. 230 ; but if every creditor con- sents, such or- der will be made at the risk of the pe- titioner. Mr. Commissioner Atrton. — Till very lately, there existed an opinion that the Commissioners had jurisdiction on aU occasions in which the Court of Review would have had jurisdiction ; but having regard to the case of Ew parte 8 Nov. 1852. Carter, re Dimmoclt, where the Lord Chancellor decided that after the seven or fourteen days mentioned in sec. 104 have elapsed, the Commissioner has no power to annul ad- versely on the bankrupt's application, it appears to me that the power of the Commissioners, as to annulling, is restricted and less extensive than that formerly possessed by the Court of Review ; and I think that the power of the Commissioner, on the bankrupt's application, is now confined to cases which 262 RFPOETS OF CASES 1852. Ex paurte LnxpoKD, re Ldxfokd. fall within clause 104 or clause 230, and, therefore, that I have no power to annul in this case till after the bankrupt shall have passed his last examination, when he can proceed under sec. 230. Bond afterwards produced an affidavit that the creditors who had consented to the bankrupt's petition to annul were his only creditors at the date of filing the petition, and that he was not indebted to any other person whatever. Mr. CSmmissioner Ayeton. — I may now safely order the adjudication to be annulled and the petition dismissed, because, though I have not, in strictness, jurisdiction to make such an order, yet, if the bankrupt and every one of his creditors consent to the order, it can never come into question or be disputed. Adjudication annulled and petition dismissed. Th/wrsday, April 8th. Semlle.— The Court of Bank- ruptcy has no jurisdiotion to annul with con- sent of credi- tors, save un- der sees. 130, 131. Where the bankrupt may hare to be pro- secuted for of- fences under the bankrupt law, the Court will not so an- nul, even if there be juris- diction. Ex parte Harris, re Harris. 1 HIS was a petition to annul the adjudication with the consent of all the creditors, including the assignees. Shackles, for the bankrupt. — The Court has power to annul the adjudication, as was formerly done, with the consent of all the creditors who had proved or claimed. In this case, in deference to the opinion of the Court, much more has been done, as the consent of 147 creditors has been procured ; in fact, every creditor but three has signed, two of which credi- tors are corporations, but the corporate seal has not been affixed ; and the third, a creditor for 12s. 6d is abroad, and owes the estate bl. He cited and commented upon 6 Geo. 4, c. 16 ; 1 & 2 Wm. 4, c. 56 ; 10 8e 11 Vict. c. 102 ; 12 & 13 Vict. c. 106, S3. 12, 104, 230, and 231 ; Lord IN BANKRUPTCY. 263 Eldon's Order, 1818 ; Ex parte Duckworth, 16 Ves. 416 ; 1852. He Chambers, 4 Dea. & Ch. 578 ; Ex parte Carter, 8 Nov. 1852 ;(a) Ex parte Kimbell, 1 Mont. & De Gex, 138. Haems, Mr. Conmiissioner Atrton. — In this case I am asked to order the adjudication to be annulled, such order being con- sented to by the creditors. Formerly, the Lord Chancellor who issued the commission of bankruptcy possessed, under his general assumed jurisdic- tion, an almost absolute control over it, so far as regarded superseding it afterwards ; and this power, under the designa- tion of annulling the fiat, was afterwards exercised by the Lord Chancellor, after the institution of the Court of Review ; for though the Court of Review, and afterwards the Vice-Chan- cellor, were constantly in the habit of ordering the fiats issued by the Lord Chancellor to be annulled, yet these orders were invariably accompanied by the words, " if the Lord Chancellor thinks fit ;" and the fiat was not annulled till the Lord Chancellor's confirmation of the order was procured. It is not doubted that formerly there existed a method by which a commission could be superseded, or a fiat annulled, at any time, with consent of aU the creditors who had proved or claimed under the bankruptcy ; my doubt is, whether the Commissioners of the Court of Bankruptcy possess any such general jurisdiction. When the Bankrupt Law Consolidation Act passed, in 1849, all jurisdiction in bankruptcy, save on appeal, was sup- posed to have been taken away from the Vice-Ohancellor, and it was at first assumed that the whole of the Vice-Chancel- lor's jurisdiction in bankruptcy, save the appellate, was trans- ferred from his Honour to the Commissioners of the Court of Bankruptcy, by the 12th clause ; for instance, it was thought that a bankrupt, after the lapse of seven or fourteen days mentioned in sec. 104, might stiU prefer a petition to the Commissioners, under this general jurisdiction, to annul the (a) And 18 Law Times, 269. Haheis. 264 REPORTS OP CASES 1852. adjudication, for any defect of the requisites, such as the utter want of any petitioning creditor's debt, and so forth ; Hakkis, and thus it was decided by the Vice-Chancellor Knight Bruce Harms ^^ ^^ Dimmock, where it was held, that if the bankrupt did not avail himself of sec. 104, by applying to the Com- missioner within the seven or fourteen days, as the case might be, or did not appeal within the time allowed, then, by sec. 233, the Gazette containing the adjudication was declared conclusive evidence of the bankruptcy, as against the bank- rupt. This decision, it will be observed, was made on an adverse application ; but it proves that the power of the Commissioners, as to annulling, is not so extensive as was supposed, and that the Court of Bankruptcy must be very wary not to exceed the limits of its jurisdiction. If the Commissioner has not power to make an order adversely, can any consent confer jurisdiction ? For it must be remembered that this is not a mere question of practice: if I act without jurisdiction, my order is, of course, a nullity ; and many years after it has been made, some conveyancer may discover its invalidity, and object to a title to land, on the ground that the order annulUng was itself a nullity, and the estate still vested in the assignees under the bankruptcy. The present application is to annul with the consent of creditors. Formerly the practice was to make this order without requiring the consent of every one creditor, it being sufficient if the consent was obtained of so many of the creditors as had actually proved or claimed under the bank- ruptcy at the time the order was made. In the case now before me, every creditor who has proved or claimed, and all the assignees, do consent to the adjudication being annulled ; in fact, I am assured that aU the creditors have signed their assent but three, two being corporations, and the third abroad. The question, then, is, have I jurisdiction to make the order asked ? IN BANKRUPTCY. 265 Mr. Shackles, who appears for the petition, states that such 1852. orders are habitually made in the London and other Courts Ex parte of Bankruptcy ; if so, I should be most anxious to follow the Haekis, precedents set by my learned colleagues. Harms. Having regard, then, to the warning of the decision in Ex parte Carter, can I find that I have jurisdiction to make such an order, which undoubtedly could formerly have been made by the Vice-Chancellor in Bankruptcy, confirmed by the Lord Chancellor ? Sec. 12 says that the Court (that is, the Commissioner), in the exercise of its primary jurisdiction, by virtue of this Act, shall have superintendence and control in all matters of bankruptcy. I confess that I am at a loss to know what meaning to give to the word " primary," not being aware of any secondary jurisdiction ; but passing that by, the words " control in all mattters in bankruptcy" would appear to confer a very extfen- sive jurisdiction indeed ; but, on reading on a little further in sec. 12, I find myself cautioned by the words " save and except as may be, by this Act, otherwise provided." Does, then, the Act " otherwise provide" touching the subject-matter of this petition ? That subject-matter is a petition to annul the adjudication with the consent of the whole of the creditors, who have accepted a composition, as I have been informed by Mr. Shackles. It appears, on turning to the Act, sees. 211 to 231, that the Legislature contemplated a complete provision touching arrangements or compositions with creditors: one subdivision of the Act relates to arrangements between debtors and their creditors under the superintendence and control of the Court ; the next subdivision is concerning such arrange- ments by deed; and then we arrive at the subdivision which comprises sees. 230 and 231, which sections contain a special enactment laying down the method of proceeding in cases similar to the present. 266 REPORTS OF OASES 1852. Sees. 230 and 231 are thus headed: "Of compositions _ after bankruptcy. And with respect to compositions after £x parte . . Habeis, adjudication of bankruptcy, be it enacted." And then follow Habris. sees. 230, 231, pointing out how the consent of nine-tenths of the creditors is to be obtained, and then the adjudication is to be annulled, and the petition for adjudication dismissed. It appears to me that the terms of these clauses, coupled with the indication of the intent of the Legislature afforded by the words " and with respect to compositions after bank- ruptcy" (this being such a composition), show that the Court does not possess any power to annul with consent of cre- ditors, save under sees. 230 and 231 ; so that I have not any jurisdiction to annul, on a composition, save under those clauses. If, indeed, every single person who was a creditor at the time of filing the petition for adjudication, together with ev*ry person who could by possibility have a right to prove his debt under the bankruptcy, — if all these were to consent to my making such an order, at their own risk, I do not say that I might not, in a proper case, venture to annul the adjudication, because, though, as I think, I have no jurisdic- tion so to order (save under the terms of sees. 230, 231), yet, if every person who could by possibility object to the order were to consent to its being made, then I think I might venture to do so, because, though invalid, yet its invalidity might never be questioned, and the bankrupt would take the order suo periculo. I say I would so venture to act in a proper case. Now with reference to the particular instance now before me, I regret to have to say that even if I thought that I had jurisdiction now to make the order asked, yet I entertain very serious doubts whether, under the very extraordinary circum- stances attending this bankruptcy, of which I have judicial notice, I ought not, in the exercise of my discretion, to refuse to annul this bankruptcy till the bankrupt shall have passed IN BANKRUPTCY. 267 his last examination, and makes his order under the terms of sees. 230, 231. It being familiar law, that when an application was made to the general jurisdiction of the Lord Chancellor to annul, the order was entirely in his discretion. Two young men have been declared bankrupts in this court, and have both been examined before me ; they have both been connected, in the way of business, with this bank- rupt, Harris, and they have both made statements in open court, which have not hitherto been contradicted, which, if true, would show that this bankrupt has been engaged in a most scandalous and nefarious system of swindling ; and they have both stated, what for the credit of human nature every one must wish to be incredible, but which has not yet been attempted to be disproved, that this bankrupt advised both these young men to insure their stocks, and then remove such stocks, and then set fire to their houses, with intent to defraud the assurance office. I will say no more of the statements made by these young men but this, that if only a portion of the charges made by them against the bankrupt is true, he may have to answer for his acts at the bar of a criminal court, for offences against the bank- rupt law ; in which case, to annul this bankruptcy, might amount to something very like sanctioning a species of com- promise of criminal offences. Under these circumstances, I think it fit that this bank- rupt should pass his last examination, as required by sec. 230, and then apply, under that section, to annul with consent of nine-tenths of his creditors. I notice that the conclusion of sec. 231 contains an enactment which it may be highly expedient to insist upon in a case like the present ; it is as follows : " And if any cre- ditor shall agree to accept any gratuity, or higher composition, for assenting to such offer, he shall forfeit the debt due to him, together with such gratuity or composition ; and the bankrupt shall, if thereto required, make oath before the T 2 1852. Ex parte Harris, re Harris. 268 EEPOETS OF CASES 1852. Ex parte Hakbis, re Hakbis. Court, that there has been no such transaction between him and any of his creditors ; and that he has not used any undue means or influence with any of them to attain such I have to notice that this petitioner was not quite prepared to ask for the order to annul, till Friday, the 3rd of April ; and this, the 7th of April, is the day fixed for the bankrupt's last examination. In conclusion, I shall observe that if there existed no appeal &om my order, I might be tempted to make an order which, I am told, is commonly made in London ; but enter- taining grave doubts on the question of jurisdiction, I wish the point to be determined and set at rest by the Lords Justices. Tuesday, JwM 15ih. Proof by surety. Surety for a debt due to the bankrupt must pay or satisfy the whole debt before he can be allowed to prove ; but the administration of a deed surety wag allowed to en- ter a claim, to stand until it could be ascer- tained whether the estate of the deed surety could pay the debt. (Before Mr. Commissioner Fonblanque.) Be Beaumont. 1 , H. having drawn upon bankrupt for 285^. 9s., which bill was disbursed, paid to the holders 193^. 2s. ; and subse- quently died. Bees, solicitor, for the holder, applied to prove for 95^. 17s., the balance due on the bill. Millar, solicitor, for the administratrix of T. H., suggested that the holder should prove for the whole amount of the bill, and stand as trustee for the administratrix for so much as she had paid, or should hereafter pay. By the Cottrt. — This is a novel application. A surety, or person liable, must by the words of the statute pay the whole debt, or part in satisfaction of the whole, before he is IN BANKEUPTCY. 269 allowed to prove ; and a common right might arise, if any 1852. other course was to be pursued. Me Beaumont. Millar. — The administratrix cannot pay the whole, this being merely a simple contract debt, till she has ascertained that there are no other debts entitled to priority : in the mean time she will not be represented under the estate of the bankrupt. By the Court. — Under those circumstances, she may enter a claim for 193/. 2s. May \5th. (Before Mr. Commissioner Fane.) Re Taylor, ex parte Riohar.ds. X HIS was a petition by Thomas Richards, the executor and Written me- sole residuary legatee of William Richards, for the sale of ™hen°raffioient certain leasehold premises at Kennington, Surrey, belonging to entitle equit- , P , • , , n , 1 • 1 . f able mortgagee to the bankrupt, the lease of which had been deposited with to costs of sale, the petitioner's testator, as security for a loan of money, in the year 1842. The petition prayed that the costs of the petition and sale, &c. should be paid out of the proceeds. Barley, counsel, for petitioner. — The only question is, whether the petitioner is entitled to costs, and that depends upon the question whether the mortgage is evidenced by writing. It is admitted that there was no writing at the time the lease was deposited by the bankrupt with the testator, William Richards ; but in March, 1851, the present petitioner, who then stood in the place of William Richards, entered into an arrangement for the settlement of certain partnership disputes with the bankrupt Taylor, upon which a memoran- dum of agreement was drawn up and signed by the authorized 270 REPORTS or CASES 1852. agent of Taylor, and by the petitioner, which memorandum contained these words : " Mr. Richards to give up the lease Tatlob, of the houses at Kennington upon payment of 2001. and in- kTo^bds. terest from this date, 25th March, 1851." From this memo- randum, it was clearly to be inferred that the petitioner held the lease in question as security for 200/. and interest, the precise amount which the petitioner now claimed to be entitled to upon the footing of his mortgage. That the memorandum was long subsequent to the deposit of the lease, did not affect the petitioner's right to costs. (£Ja! parte Reynolds, re Moore, 4 Deac. & Chit. 279.) LinUater, solicitor, for the assignees. — The petitioner is not entitled to costs ; for the only written memorandum pro- duced, that of the 25th March, 1851, is consistent with the petitioner not holding the lease as equitable mortgagee, but in a different character. Besides, it appears from the preceding parts of the memorandum, that it was made in contemplation of some arrangement by deed which was never executed. Mr. Commissioner Fane. — It may be clearly inferred from the memorandum, signed by an authorized agent of the bank- rupt, Taylor, before his bankruptcy, that the petitioner held the lease in question under circumstances which induced Taylor to believe that he could not demand the lease without payment of 200/. and interest. The sum specified in the memorandum is precisely that now claimed by the petitioner as equitable mortgagee. It is impossible to say there is no written evidence that the lease wa's deposited as security for money, and I think the evidence is sufficient to entitle the petitioner to his costs. Order as prayed for. IN BANKRUPTCY. 271 1851. (Before Mr. Commissioner Ellison.) i?. Atkinson, (a) ^-^ll J. HIS was an application by the assignees, after the sale and Mortgagor in conversion by them of stock in trade and furniture in the order and dis- reputed ownership of the bankrupt, for- an order, under the position. 125th section of the Bankrupt Law Consolidation Act, 1849, stock in trade to sell and dispose of the same for the benefit of the creditors, ^jg power o The facts of the case were these :— Mortgagee permitted the Atkinson, the bankrupt, kept an inn at Newcastle-on- stock to remain Tyne. On the 30th of August, 1850, he committed an act gion of the of bankruptcy by departing from his dwelling. In 1847 he to°tli?1ime^ granted a mortgage of his stock in trade, with power of sale, when the . , , latter com- to a creditor (Mr. Heslop, of Darlington, a wholesale spirit- mittedanact dealer), to secure a sum found due on an account stated, for ^^ which"he"^' spirits supplied to him in his trade. Atkinson was then was adjudi- carrying on business at Croft, near Darlington, in the county rupt : of Durham, from which place he removed to Newcastle with the stock pass- the residue of his stock and his furniture, whereof, and of all ^^ *° *? ^^'^" ' ' nees as bemg stock subsequently acquired, Heslop allowed him to continue in the bank- , . , 1 . mi 1 1 rupt's order and m the possession and apparent ownership. The stock and disposition, furniture actually upon the premises at the time of the act of bankruptcy were in Atkinson's possession, but were claimed by Heslop to be his, under the deed of assignment for securing the debt, which continued to be due and owing to him. This being the state of matters on the 4th of September, 1850, Heslop, who had heard at Darlington, on that or on the previous day, that the bankrupt had absconded, came to the inn at Newcastle, and put a man in possession of all the pro- perty therein, under his deed. Before any sale of the goods, and on the 9th of September, a petition for adjudication of bankruptcy, founded on the departing from home, was pre- (d) See Jleslop v. £aher, 6 Ezch. 740. 272 REPORTS OF CASES 1851. sented to the Court of Bankruptcy for the Newcastle district, under which petition Atkinson was duly found bankrupt, and Atkinson, on the messenger entering, Heslop's man withdrew. The assignees, as soon as they were chosen, contracted with a person for the sale and purchase of the goods in question, and of their own authority, without any application to the Court, sold the same to the purchaser, and received the proceeds, which were paid in to the credit of the estate. Heslop there- upon sued the assignees in trover ; and at the trial of the action at the assizes, the jury found that the goods in question were in the reputed ownership of the bankrupt at the time of his bankruptcy, with consent and permission of the plaintiff Heslop, and a verdict passed for the defendants, the assignees. But, on behalf of the plaintiff, it was objected at the trial, that the provision made by the 125th section of the Bankrupt Law Consolidation Act, 1849, had rendered it necessary for assignees to obtain an order of the Commissioner before they could sell property in the reputed ownership of a bankrupt ; and this question was argued before the full Court of Exchequer on a motion for a new trial. In June, 1851, Mr. Baron Parke delivered the judgment of the Court, which was to the effect that an order of the Commissioner must be obtained by assignees to authorize them to deal with pro- perty so circumstanced, and no such order having been obtained in the present case, a new trial was awarded. The assignees thereupon applied to Court for an order to sell and dispose of the goods in question, as if the sale were still to be made. Upon that application, Heslop, the plaintiff in the action, and the bankrupt, were severally examined, and the solicitor for Heslop contended that the order should not be made. His objections were, first, that as the goods had been abeady sold, there was not, as he submitted, any property for the order to operate upon ; second, that the seizure by Heslop was a transaction within the 133rd section of the Bankrupt Law Consolidation Act, 1849, which section relates to " transactions not affected by bankruptcy," and renders valid IN BANKRUPTCY. 273 executions levied by seizure and sale before a petition for 1851. adjudication, notwithstanding a prior act of bankruptcy, pro- ~T ■vided the creditor levying had not notice thereof ; and third, Atkinson. that if it be discretionary in the Court to make such an order, the Court ought not, upon the merits in the present case, to make the order prayed by the assignees. JUDGMENT. / The question being new, and of much importance, I took time to consider this application, and for a reason which I will presently state, I directed that evidence should be given before me on the question whether Mr. Heslop, at the time of seizure, had notice of the act of bankruptcy. I am told the jury at the trial found this in the affirmative ; how- ever, the evidence has been given before me, and I now pro- ceed to state the decision at which I have arrived, and the reasons on which it is founded. I shall first take the second of the objections urged on behalf of Mr. Heslop to my makiag this order. That objec- tion is, in effect, that the seizure by Mr. Heslop was a trans- action not affected by bankruptcy, and sufficed to give him a title to the goods in question as against the rest of the creditors, notwithstanding those provisions of the laws by which property in the reputed ownership of a bankrupt at the time of the bankruptcy passes to the creditors generally. Now, it is most important to observe, that a clear distinction, as it appears to me, is made by the Bankrupt Law Consolida- tion Act itself between property in the reputed ownership of a bankrupt and property of which he is the actual owner at the time of seizure. It appears to me, that the protection given by the 133rd section of that statute to transactions which take place before the petition, and without notice of an act of bankruptcy, is given in respect of goods which are the actual property of a bankrupt ; and in the absence of authority, I should have no hesitation in holding that it is not competent to the true owner of goods in the reputed owner- 274 EiEPORTS OF CASES 1851. ship of a bankrupt at his bankraptcy, to acquire a title to such ~ goods, as against the rest of the creditors, by an act done Atkinson, within the meaning of the 1 33rd section, or, in other words, to defeat the operation of the doctrine of reputed ownership. I shall advert presently to the two cases which are authorities for a contrary conclusion. For a long period after the statute of the 13th Elizabeth, c. 7, transactions with a bankrupt were held to relate to the act of bankruptcy ; but the severity of the doctrine as to the relation to the time of the act of bankruptcy of transactions with a bankrupt has been modified from time to time in favour of persons dealing bond fide with their debtor. The statute of the 13th Elizabeth, c. 7, is the origin of that doc- trine of the relation of transactions to the act of bankruptcy on which so many important decisions are to be found in the books. [His Honour here referred to the enactment in that statute, and traced its modification in the statutes 1 Jac. 1, c. 15 ; 21 Jac. 1, c. 19 ; 46 Geo. 3, c. 135 ; 49 Geo. 3, c. 121 ; h% Geo. 3, c. 137 ; and 6 Geo. 4, c. 16, s. 72.] The general effect of all these modifications was, that all bond fide transactions and executions which were had or levied more than two months before the issuing of the com- mission were valid, notwithstanding a prior act of bankruptcy, provided the creditor had not at the time of the transaction or execution notice of that prior act. [The Commissioner then referred to 2 & 3 Vict. c. 1 1, and 2 & 3 Vict. c. 29.] At length, by the.Consolidation Act, bond fide transactions in respect of a bankrupt's property, and executions levied thereon, are declared valid, and not affected by a previous act of bankruptcy, pro- vided the creditor so dealing or levying had not notice of an act of bankruptcy. But while this class of provisions has undergone modification by many statutes, and whUe the original severity of the doctrine of relation has been thus relaxed, the enactments which relate to property in the reputed ownership of a bankrupt have been preserved in their original severity ; and it appears to me that the Bankrupt Law Con- IN BANKRUPTCY. 276 solidation Act makes a clear distinction, as I have said, 1851. between property which is in the reputed ownership of a bank- rupt, and property of which he is the actual owner ; and that Atkinson. all the provisions by which the severity of the law of relation has been modified apply to goods which are the property of the bankrupt, and do not apply expressly nor, as it appears to me, by implication, to the goods of any person other than the bankrupt. The object of the other provisions in the bankruptcy statutes is, to transfer to the creditors such pro- perty and interest as actually belong to the bankrupt himself ; but the provision with regard to property in the reputed ownership of a bankrupt has the effect of giving to the credi- tors, in respect of the apparent ownership of the bankrupt and the credit supposed to be derived thereftom, a right dero- gatory and paramount to that which would exist as between the bankrupt and third persons. The object of this provision being to protect all the creditors of a trader against the con- sequences of that false credit which might be acquired by his being suffered to have the order and disposition of pro- perty as his own which does not really belong to him, it is a provision which must undoubtedly have been at all times of high importance to the interests of fair trade. The intent and meaning of this law is well explained by Lord Redesdale in Joy V. Campbell, 1 Sch. & Lef. 336 : — [His Honour read from the judgment, and continued.] In order, therefore, to bring a case within this doctrine, there must be a real owner distinct from an apparent owner, and the real owner must consent to the apparent ownership of the bankrupt. To come within the operation of the 125th section of the Consolidation Act (which I may consider merely a re-enactment of the provision in former Acts with regard to property in the reputed ownership of a bankrupt), the goods must be in the bank- rupt's possession at the time of his becoming bankrupt ; and the time of his becoming bankrupt is, according to the judg- ment in Load v. Green, 15 M. & Wels. 216 ; Lyon v. Weldon, 2 Bingh. 334 ; and Smith v. Topping, 5 Barn. & Adol. 674, 276 REPORTS OF CASES 1851. the time of committing the act of bankruptcy. It is said that the doctrine of reputed ownership is not now favoured by the Atkinson. Superior Courts ; and certainly it may be doubted whether, if the Courts were now called upon for the first time to put a construction on the statute, they would apply the doctrine, for example, to cases of assignments of debts, bonds, and policies, where no notice of assignment had been given, and would hold that property of this nature remained in the order and disposition of the bankrupt with consent of the true owner. I wish to refer the parties to the judgment of Pol- lock, C. B., and Parke, B., in Belcher v. Bellamy, 2 Exch. 306. But I am not aware of any authority which takes away from the creditors generally the goods and chattels, such as furniture and stock in trade, of a person who has " impro- perly and \inconscientiously, as the law supposes," allowed such property to remain in the apparent ownership of a trader down to the time of the bankruptcy, and thereby enabled him to obtain false and delusive credit. It was for some time a controverted question, whether the operation of the 21 Jac. 1, c. 19, s. 11, was not restrained by the preamble to property formerly belonging to the bankrupt, and remaining in his pos- session ; but the contrary was finally settled in 1 774 in Mace V. Cadell, 1 Cowp. 232 ; and the provisions of that statute have been substantially re-ena«ted in the several bankruptcy statutes down to the Consolidation Act, and are in substance preserved by that Act likewise The 1 33rd section of the Consolidation Act, and the like clauses in former Acts, relate, in terms, to the property of the bankrupt, whereas the 125th section, and the like clauses in former Acts, relate, as I have pointed out, to property which belongs to some other person, and of which the bankrupt is only the apparent owner. As to this latter property, the act of bankruptcy is the dividing point ; and it appears to me that a seizure by the real owner is not protected by the 133rd section. That section, as it appears to me, has no application to the power which is given to the Court over that description IN BANKRUPTCY. 277 of property which is the subject of the 125th section. And r.1851. even if it had, seizure and sale are necessary before the party claiming adversely can acquire a title as against the rest of Atkinson. the creditors. A creditor, by the seizure of the goods of his debtor, does not acquire the property in such goods, nor divest it from the bankrupt. The case of Giles v. Grover, 9 Bingh. 178, and the expressions of Lord Chief Justice Tindal in that case, at p. 767 of the same volume, may be referred to on this point. In the absence, therefore, of express authority to the con- trary, I should decide that the seizure, by a person claiming to be true owner, of property in the reputed ownership of a bankrupt, is not a protected transaction — a " transaction not affected by bankruptcy" — and cannot deprive the Court of Bankruptcy of the power to order such property to be sold for the benefit of the creditors. But the case of Ex parte Styan, 1 Phill. 105 ; and the case of Pwriente v. Pennell, 2 Moody & Rob. 517 (in which case the doctrine as laid down by Lord Chancellor Lyndhurst in Be Styan, was fol- lowed by Lord Chief Justice Tindal), have occurred to me, whUe considering the present application, to be authorities for the proposition, that a person who claims to be real owner for valuable consideration of property in the reputed ownership of a bankrupt, may, by an act done by him after the act of bankruptcy and before the petition, deprive the Court of Bankruptcy of the power to order such property to be sold for the creditors under the 125th section ; or, in other words, that the real owner's seizure and sale, if without notice of the act of bankruptcy, may be a "transaction not affected by bank- ruptcy," and be protected by the 133rd section of the Con- solidation Act. The decisions in Be Styan, and in Pa/riente v. Pennell, it will be observed, were given many years ago ; but as they are undoubted authorities, it appeared to me in the present case, that I ought to have evidence laid before me on the point of notice at the time of Mr. Heslop's seizure ; and evidence has 278 REPORTS OF CASES 185L been given before me accordingly. The result of it is, that ■~ I am satisfied he had express notice of the act of bankruptcy, Atkinson, before he entered and took possession, and therefore the authority of the cases I have just mentioned is not applica- ble in the present case. Upon these grounds, therefore, I overrule the second of the objections taken on behalf of Mr. Heslop to my making an order under the 125th section of the OonsoKdation Act. The first objection is, in efiect, that I ought not to make that order now, inasmuch as the property to be afiected by it has been already sold ; but my decided opinion is, that I am bound to make the order. Hitherto, property in the reputed ownership of a bankrupt has been taken by the assignees like other property in the bankrupt's possession, and the Consoli- dation Act has for the first time given power to the Com- missioner to order it to be sold for benefit of the creditors — a provision which appears to throw on the Court of Bank- ruptcy the duty of trying the whole question, and deciding upon the evidence. Property in the reputed ownership of the bankrupt, within the meaning of the 175th section (which, as I have said, is a mere re-enactment in substance of former provisions on this subject), passes to the creditors ; but they have not had the benefit intended to be given to them until the order contemplated by the statute shall have been made ; and the Court has not finally discharged its duty, or exercised the power given to it for the benefit of creditors, until it shall have considered the facts, and made an order authorizing the assignees to sell and dispose of the property. I need not inquire whether, in the circumstances of the present case, my order will have the effect, by relation or otherwise, of giving a valid title to the vendor from the time of the sale to him ; — ■ that is a question which will be more properly considered elsewhere. I deem it my duty to make the order. I have now, therefore, only to dispose of the third objection, and, without deciding whether the power to make the order is discretionary or not, I am satisfied that I am now dealing IN BANKRUPTCY. 279 with precisely the case to which the doctrine of reputed own- ership has been always held applicable ; it is a case within the very words of the statute of 21 Jac. 1, c. 19, and is the case of an owner who has allowed the bankrupt to remain in possession of his property as reputed owner, and to obtain credit on the faith of it. 1851. He Atkinson. Order for sale made as prayed, (a) (a) Seslop V. Barker, 6 Exch. 740. The marginal note is as fol- lows : — Goods in the order and disposition of a bankrupt as reputed owner, do not pass to his assignees under the 141st section of the Bank- rupt Law Consolidation Act (12 & 13 Vict. c. 108) ; hut in order to vest the property in such goods in the assignees or other person, the Court of Bankruptcy must make an order under the provisions of the 125th section. (Piatt, B., d/vMtamte.) Parke, B., in ^ving the judgment of the Court said (mter olid!), " At a time prior to 1 & 2 Wm. 4, u. 56, t). 25, there is no question that the general assignment operated to vest in the assignees goods in the reputed ownership of the bankrupt." When that statute had passed, it is a question whether such goods did pass by the adjudication, by virtue of the 25th section. That section provides, that " When any person hath been adjudged a bankrupt, all This personal estate and eflFects, pre- sent and future" (not the personal estate, &c.), "which by the laws now in force may ie assigned by Commissioners acting in the execu- tion of a commission against such bankrupt, shall become absolutely vested in and transferred to the assignees by virtue of their appoint- ment, without any deed of assign- ment, as if such estate were assigned by deed to such assignees and the survivor." On the one hand, the language of the former part of the section appears to apply to the bankrupt's own property only ; on the other, the words "which by the laws now in force may be as- signed by the Commissioners," may give the former words a more ex- tensive operation. In a note on this statute, by Messrs. Eoe and Miller, in their edition of Mont. & Ajr.'a Bankrupt Law, vol. ii, p. 230, it is said that neither the property mentioned in the 71st section, nor that in the 72nd section of 6 Geo. 4, c. 16 (goods in the possession and reputed ownership), vests in the assignees by the adjudication. If this be so, no question could possibly arise in this cajse, for a similar construction would have to be made of the 1 41st section of the 12 & 13 Vict. c. 106, which would pass only the bank- rupt's own personal estate, by its proper description of his personal estate and effects. But supposing it to be otherwise, and that by » 280 EEPORTS OF CASES 1851. Re Atkinson. liberal construction of the 1 & 2 Wm. 4, u. 56, a. 25, it ought to be held that the words " his estate" compriaed all the estate which by the laws then in force might be as- signed by the Commissioners to the assignees, and consequently that the propeHy in the reputed ownership of the bankrupt did vest under that statute, it by no means follows that it could pass under the 141st section of the new Bankrupt Act, even if it stood alone ; for in this section we do not find the only words which might enable us to give a more extensive signification to the words "all his estate," that is, the words "which by the laws now in force may be assigned by Commissioners ;" under which words it may be supposed that the Legisla- ture meant to comprise all that could be assigned. And when we find that in the same Act of Par- liament, the 72nd section of 6 Geo. 4, u. 16, is re-enacted with this al- teration only, that instead of the Commissioners having power to sell and dispose of the same, that is, practically to assign them to the assignees, the Cov/rt has power not to sell and dispose, but to order them to be sold and disposed of, we think that the meaning of these enactments in the new statute is, that in the case of the bankrupt's own property it is to pass by the adjudication ; but in case of chat- tels in his reputed ownership, some- thing different must be done, and the Court must make an order to sell and dispose of the same, in order to vest the property in the assignees or some other person. * * * * Whether this state of the law arises firom a miatake in the &amer of the Act, or was intended, is a matter of conjecture. Poasilly it may have been a mistake in mak- ing these enactments in the terms used J * * * according to the words of the enactment, it is clear that the goods in question do not pass by the adjudication. GENERAL ORDERS MADE UNDEE THE BANKRUPT LAW CONSOLIDATION ACT, 1849. I2th October, 1849. It is Ordered as follows, that is to say : — That the several Rules and Orders in or relating to matters of Bankruptcy, or to the official assignees, or other officers in bank- ruptcy, or to the forms of proceedings, or the practice to be ob- served in the Court of Bankruptcy, and being in force at or immediately preceding the commencement of the Bankrupt Law Consolidation Act, 1849, shall, from and after the commencement of such Act, and until further order, be the Rules and Orders under the same Act, for the better carrying the said Act into execution ; and as regards the duties to be performed by the chief and other registrars, the accountant- master, clerk of enrolments, official assignees, registrar of meetings, and clerks, and by the messengers, ushers, and other under-officers of the Court of Bankruptcy, and generally for regulating the practice of the court, and the forms of proceedings, where not provided for in the said Act, so far as such Rules and Orders are applicable to such purposes, and not inconsistent with any of the provisions of the said Act; and that, subject to such restriction, the said Rules and Orders shall extend and apply, not only to commissions and fiats in bankruptcy, but to petitions for adjudication of bank- ruptcy, and the proceedings thereunder respectively, and gene- rally to all matters provided for by the said Act. Joshua Evans, John S. M. FoNBLANauE, R. G. C. Fane, Edward Holrotd, Edward Gotjlburn, H. J. Shepherd, Henry J. Stephen, Edmund Robert Daniell, Commissioners. Approved : COTTENHAM, C. GENERAL ORDERS IN BANKRUPTCY. May Zlst, 1850. Whereas by the Bankrupt Law Consolidation Act, 1849, it is enacted, amongst other things, as follows, that is to say, " That the official assignee of each bankrupt's estate, and every official assignee appointed by the Court under any petition for arrange- ment between a debtor and his creditors, where the estate and eiFects of such petitioning debtor shall vest in such official as- signee, either alone or jointly, in manner therein mentioned, shall pay to the credit of the account intituled ' The Chief Re- gistrar's Account,' such sum not less than one- eighth of a pound, and not exceeding five pounds per centum on the gross produce from time to time of any such estate, such sum, within the limit aforesaid, and the time or times for payment thereof, to be fixed by the Senior Commissioner, with the approval of the Lord Chancellor, and the Senior Commissioner, with the like ap- proval, may from time to time lessen or increase such sum, within the limit aforesaid, as may seem just and reasonable, upon consideration of the amount from time to time standing to the said account, and of the claims from time to time chargeable thereupon :" Now I do hereby order, that the official assignee of each bankrupt's estate, and every official assignee appointed by the Court under any petition for arrangement between a debtor and his creditors, where the estate and effects of such petitioning debtor shall vest in such official assignee either wholly or jointly in manner mentioned in the said Act, shall before every audit under any bankrupt's estate, and before the passing of every account of the official assignee under any petition for arrange- ment, pay to the credit of the account intituled " The Chief Registrar's Account," on the gross produce from time to time of the estate of any bankrupt or bankrupts, and of any petitioner or petitioners under any petition for arrangement, sums after the rates hereinafter mentioned, that is to say. Upon the first moneys of such gross produce not exceeding 500/ 5 per cent. Upon all further moneys of such gross produce, above 500/. and not exceeding 5,000/ 3 per cent. Upon all further moneys of such gross produce, above 5,000/. and not exceeding 10,000/. . . 2\ per cent. Upon all further moneys of such gross produce, above 10,000/. and not exceeding 20,000/. . . 1 per cent. GENERAL ORDERS IN BANKRUPTCY. ] Upon all further moneys of such gross produce, above 20,000/. and not exceeding 30,000/. . . J per cent. Upon all further moneys of such gross produce, above 50,000Z. and not exceeding 100,000/ ^ per cent. JosnuA Evans. Approved : COTTENHAM, C. Wednesday, the 9th day of October, 1 850. Order made by the Right Honourable Thomas Lord Truro, Lord High Chancellor of Great Britain, relating to the payments ta be made to the Chief Registrar's Account by the Commis- sioners of Inland Revenue under the provisions of the Bank- rupt Law Consolidation Act, 1849, and to the allovpance upon the sale and distribution of Stamps, and the allowance of spoiled and other Stamps, under the Act, ss. 33 and 48 to 52. It is Ordered : — That once in every week, the Commissioners of Inland Revenue shall cause to be paid into the Bank of England, to the ciedit of the Accountant in Bankruptcy, to the account entitled "The Chief Registrar's Account," such sums of money as may have been received by them for stamps sold under the provisions of the Bankrupt Law Consolidation Act, 1849, and once at least in every three months, as soon as practicable after the fifth days of Ja- nuary, April, July, and the tenth day of October respectively, the said Commissioners shoill cause to be delivered to the Chief Registrar of the Court of Bankruptcy, an account of the number and description of stamps issued, and of the sums of money col- lected or received by them under the provisions of the said Act, and after paying, deducting, and retaining all costs, charges, and expenses incurred by them, or by their order, in carrying the said provisions into effect, and all allowances made by them for spoiled stamps, shall pay the balance into the Bank of England, to the credit of the Accountant in Bankruptcy, to the account entitled " The Chief Registrar's Account;" and notice of such payment, as well as of the weekly payments before mentioned, shall, at the time of making the same respectively, be given by the Commissioners of Inland Revenue to the Chief Registrar, who shall certify the amount of such payment to the senior Com- missioner. IV GENERAL ORDERS IN BANKRUPTCY. That the poundage to be allowed upon the sale and distribu- tion of stamps under the said Act, shall be at the rate now or from time to time allowed by the said Commissioners of Inland Revenue to their distributors for other stamps, and the discount or poundage to vendors of stamps shall be at the rate now au- thorized by law to be granted on the purchase of stamps under the circumstances and of the description and amount provided in that behalf i and further, that the practice now and from time to time to be adopted by the said Commissioners with respect to the allowance of stamps (not issued under the provisions of the said Act) as may be spoiled or rendered useless or unfit for the purpose intended, or for which the owner may have no im- mediate use, or which through mistake or inadvertence may have been improperly or unnecessarily used, and with respect to the mode and time of applying for and obtaining such allowance, shall, so far as the same are and may from time to time be applicable, be adopted with respect to stamps issued under the provisions of the said Act, except that no such allowance shall be made for the stamp on any petition for adjudication of bank- ruptcy, unless a Commissioner of the Court of Bankruptcy shall direct by indorsement on such petition that such allowance shall be made. Provided also, that in any case where the practice of the said Commissioners of Inland Revenue shall not be applicable, the Court may order the allowance of any other stamps appointed to be used under the said Act. TRURO, C. RULES AND OEDERS MADE IN PURSUANCE OF THE BAMEUPT LAW CONSOLIDATION ACT, 1849, 12 & 13 VICT, CAP, 106. SECT, 8. With respect to the several matters hereinafter mentioned— It is ordered as follows, that is to say : Definition of Terms. I, That all words and expressions used in these rules or orders Definition of shall be construed in conformity with the interpretation clause **""*' *'"• (sect, 276) of the Bankrupt Law Consolidation Act, 1849, Petition /or Adjudication of Bankruptcy. II. Every petition for adjudication of bankruptcy shall be fairly Petition for written or printed on parchment in the form given in the Schedule ^''j^jdication of M or O of the Bankrupt Law Consolidation Act, 1849 (as the been parch- case may be), and no alterations, interlineations or erasures shall '"^°*- be permitted without leave of the Court ; except so far as the same may be necessary, in order to adapt the printed form to the circumstances of the particular case, III, AU petitions for adjudication and the affidavits in support Petition and of the same shall be carefully examined by the chief registrar in ^^^^ '° , . . . support thereof London, or by one of the registrars in the country districts, to be examined PETITION FOR ADJUDICATION. by registrar before filing. before they are filed, and any petition or affidavit not being in conformity with the provisions of the Bankrupt Law Consolida- tion Act, 1849, and these orders, shall be rejected, subject how- ever to an appeal to the commissioner of the day in London ; or to the commissioner in attendance in the country. Search to be made for pre- vious fiat or petition. IV. The chief registrar shall carefully search whether any fiat in bankruptcy or petition for adjudication of bankruptcy has been issued or filed against or by the same person or persons, alone or jointly with any other person or persons, and shall endorse the result of such search on the petition previous to transmitting the same to the registrar of the day. Similar searches and endorsements shall be made by the registrar in attendance in the country. Where two or more petitions, receipt of one by lot. V. That in case two or more persons shall apply at the same time to present petitions to the Court in London or to a district Court for adjudication of bankruptcy against the same person, and shall both be prepared to prosecute the same immediately, it shaU be determined by lot which petition shall first be received and filed, but if one of such persons only is prepared to prosecute his petition immediately, such person shall be preferred ; and in case one of such petitions shall be by the debtor or debtors, then the other petition (or one of the other petitions, to be ascertained as above), shall be preferred ; and no subsequent petition for ad- judication of bankruptcy against the same trader, either alone or jointly with any other person or persons, shall be proceeded with further than receiving and filing the same, until after the dismis- sal of the first, or other petition, or the expiration of the time allowed for prosecuting the same. Second petition by creditor neglecting to prosecute a former petition. VL That if any creditor shall petition for adjudication of bank- ruptcy, and shall neglect to prosecute his petition within the time limited for that purpose, no subsequent petition for adjudication of bankruptcy against the same trader or traders, or any of them, either alone or jointly with any other person or persons, shall be presented by the same creditor without the special leave of the Court to which the previous petition was addressed. VII. That every petition for adjudication of bankruptcy in Allotment of petitions for ad- t j i ,^1 ^ i , ,. " ' judication of London, whether presented by a creditor or by the trader himself. PETITION FOR ADJUDICATION. shall forthwith, after the filing thereof in the office of the chief bankruptcy in London. sect. 94. registrar, be allotted by ballot by the registrar of the day, in the ^<""*°"- ^^^ presence of a commissioner, and in the presence of the solicitor acting in the matter of such petition, to one of the commissioners of the court, and such allotment shall be entered in a locked book to be kept for that purpose, to which book each registrar and commissioner shall have a key ; and every such petition in any district court where there is more than one commissioner in district shall when filed be allotted in like manner by ballot, and entered ' l"isiness is .,.,., above a certain wittun a three miles circuit of the General Post Office, if he be distance, &c. an attorney or solicitor usually practising in the Court of Bank- ruptcy in London, or within three miles of the place of sitting of the district court, if usually practising in any country district where such notices, summonses, orders, and rules as aforesaid may be served on him, subject to the regulations aforesaid. XXXIX. All existing commissions and fiats, when transferred Existing com- to the Court of Bankruptcy in London, shall be duly entered in ^t,''™^^^"'^ the chief registrar's office, in books to be kept for that purpose, transferred, to and in the country in a book to be kept by the senior registrar ?® ^^^^"^ "* of every district court having two registrars, and by the registreir where there is only one. XL. That in addition to the minutes required to be trans- Transmission of mitted to the chief registrar by section 95 of the Bankrupt ^e'dinss from"" Law Consolidation Act, the registrars in the country districts the country dis- (or when there are two registrars, one of them) shall transmit to the chief registrar, between the 1st and 5th day of each month, a return of the proceedings of such court for the last pre- ceding month, in the form set forth in schedule 26, to these orders annexed ; and the chief registrar shall cause the same to be minuted in a book to be intituled the " Supplemental Docket Book." tricts. Sect. 23. 12 OFFICE COPIES OF PBOCEEDINSS. Proceedings to be on parch- ment or paper of uniform size, &c. Of the Proceedings. XLI. All proceedings in the court shall be written or printed on parchment or paper of one uniform size, that is to say, on sheets of sixteen inches in length and ten inches in breadth, without unnecessary alterations or interlineations ; and no erasures shall be permitted ; except by leave of the Court on special cause shown ; in which case any proceedings, though on paper or parchment not of the said size, may be received and filed. Proceedings to remain of re- cord in the court, and shall not be removed A registrar to attend in each court, and to take minutes, &c. XLII. All proceedings shall remain of record in the court, and shall not be removed, for any purpose whatever, except by special direction thereof, or of the Lord Chancellor. without special direction. XLIII. A registrar shall attend in each court, at such times as the commissioner shall direct, to take and draw up minutes of all proceedings, and such registrar shall have the charge of all such proceedings, under the superintendence of the chief registrar. Registrar not to XLIV. Except in cases of emergency, the nature whereof sit forcommis- gjj^ ^^g entered on the proceedings, no registrar shall sit or act his request in for any commissioner, under section 27, without the express wntmg. request, in writjng, of such or some other commissioner. Memorandum XLV. In lieu of attaching a copy of the Gazette to the pro- xaeafrnGazette, ceedings in each bankruptcy or other matter, the registrar shall &c., when in make a memorandum of the advertisement in the Gazette, and of Gazette°^^ ° *^^ ^^^^ thereof, with proper reference to the file to facilitate search ; and one copy of every Gazette shall be kept in the office of the chief registrar. Charge for office copies under s. 232. Office Copies of Proceedings under Sections 53 and 232. XLVI. That all office copies of fiats, petitions, or other pro- ceedings, books, papers, and writings, or any parts thereof, pro- vided for any bankrupt or arranging debtor, or for any creditor of a bankrupt or arranging debtor, or attorney of any such bankrupt, debtor, or creditor, shall be charged and paid for at DUTIES OF THE MASTER. 13 the rate directed by the 53rd section of the Bankrupt Law Consolidation Act, 1849, with respect to the office copies therein mentioned. XLVII. That all office copies shall be made by the chief Office copies. registrar or registrar, or by the messenger or usher of the court, i jqc „ 53'' as the Court shall appoint, and shall, except as to figures, be fairly written at length, and shall be sealed with the seal of the court, and delivered out by the person appointed, without any unnecessary delay, and in the order in which they shall have been bespoken. Duties of the Master. XLVIII. That the biUs to be taxed by the Master, shall be all Bills to be taxed bnis of costs, charges, fees and disbursements in matters of bank- j^ ^^i vv^'^' ruptcy, before the Lord Chancellor, the Lords Justices acting in u. 106, s. 37. bankruptcy (as are now taxed by the said Master), and the Court of Bankruptcy in London, and all other taxable bills in other matters in which the Court of Bankruptcy in London may exercise jurisdiction, and such taxable bills as may be specially referred to him for taxation by any District Court of Bankruptcy, subject to the revision of the Court. XLIX. That the office of the Master shall be at the Court of Office of the Bankruptcy in BasinghaU-street, and shall be open for the trans- ■'"^^*^''- action of business daQy, from 10 o'clock in the forenoon until 4 o'clock in the afternoon, except on such days and during such periods as the office of the Accountant in Bankruptcy shall be closed by any order of the Lord Chancellor, or by any general rule or order of the Court. L. That the business of the Master shall be transacted by him Business of the in person. Master to be * transacted by him in person. LI. That all copies of bills of costs lodged in the Master's Copies of bills, office shall be made, examined, and delivered out by the clerk who has heretofore made, examined and delivered out the same. LIT. That in the country districts all bills of costs, charges. Taxation of bills, &c. in the 14 ACCOUNTS OF PROPERTY. country dis- tricts. fees, and disbursements (except such as may be specially referred to the Master), shall be taxed by one of the registrars. Debts may be proved at sit- ting for divi- dend, see sects. 164 and 187. Separate debts may be proved under joint petition, and distinct ac- counts to be kept of joint and separate estate ; applica- tion tliereof in case of over- plus. Proof of Debts. LIII. That every sitting held for making a dividend of a bank- rupt's estate, shall be a sitting for proof of debts, and the notice of such sitting in the London Gazette shall express that debts may be proved at such sitting. LIV. That any separate creditor of any bankrupt shall be at liberty to prove his debt under any adjudication of bankruptcy made against such bankrupt jointly with any other person or persons. And under every such adjudication, distinct accounts shall be kept of the joint estate and also of the separate estate or estates of each bankrupt, and the separate estate shall be apphed in the first place in satisfaction of the debts of the separate creditors. And in case there shall be an overplus of the separate estate, such overplus shall be carried to the account of the joint estate. And in case there shall be an overplus of the joint estate, such overplus shall be carried to the account of the separate estates of each bankrupt in proportion to the right and interest of each bankrupt in the joint estate. And that the cost of taking such accounts be paid out of the joint and separate estates respectively, as the Court shall direct. Directions for taking ac- counts, and Taking Accounts of Property Mortgaged or Pledged, and of the Sale tliereof. LV. That upon application (which shall be in manner pre- scribed by Rule XVII.) by any person claiming to be a mortgagee of, or to have security over any part of the bankrupt's estate or effects, real or personal, and whether such mortgage or security shall be by deed or otherwise, and whether the same shall be of a legal or equitable nature, the Court will proceed to inquire whether such person is such mortgagee, or is entitled to such security, and for what consideration and under what circum- stances, and if it shall be found that such person is such mort- gagee, or is entitled to such security, and no sufficient objection ACCOUNTS OF PROPERTY. 15 shall appear to the title of such person to the sum claimed by him, under such mortgage or security, the Court will then pro- ceed to take an account of the principal, interest, and costs due upon such mortgage or security, and of the rents and profits, or dividends, interest or other proceeds received by such person, or by any other person by his order or for his use, in case he shall have been in possession of the property over which the mortgage or security shall extend, or any part thereof, and the Court will then cause notice to be given in the London Gazette, and in such other of the public papers as it shall think fit, when and where and by whom, and in what way the said premises or property, or the interest therein so mortgaged, or over which the security shall so extend, are to be sold, and that such sale be made accordingly, and that the assignees (unless it be otherwise ordered) shall have the conduct of such sale ; but it shall not be imperative on any such mortgagee to make such appUcation. LVI. That all proper parties shall join in the conveyance to Conveyance the purchaser (where necessary) as the Court shall direct. ^^eve neces- LVII. That the monies to arise from such sale be applied in Application of the first place in payment of the costs, charges, and expenses P™''^^ ^• of the assignees, of and occasioned by the application to the Court, and of and attending such sale, and then in payment and satisfaction of what shall be found due to such mortgagee, or person so having security, for principal, interest, and costs, and that the surplus of the said monies (if any), be paid to the assignees. But in case the monies to arise from such sale shall Proof by ore- be insufficient to pay and satisfy what shall be so found due to . "^ ""^ ^ ■' ■' ciency. such mortgagee or person so having security, then he shall be admitted a creditor for such deficiency, and receive dividends ' thereon rateably with the other creditors, but so as not to disturb any dividend or dividends then already made. LVIII. That for the better making such inquiry and taking All parties to be such account, and making a title to the purchaser, all parties be ^^^i"™™- examined by the Court upon interrogatories or otherwise as it shall think fit, and produce before the Court upon oath all deeds, papers and writings in their respective custody, or power, relating to the estate or effects of the bankrupt, as the Court shall direct. 16 ADVERTISEMENT OF CERTIFICATE. Bankrupt's Balance-Sheet. Bankrupt's LIX. The bankrupt's balance-sheet must be filed in duplicate balance-sheet ^(.j^ ^j^g j-egistrar of the court ten days at least before the dav must be filed m ° . . ■' •' duplicate ten appointed for the last examination of the bankrupt, or the days before the adjournment-day thereof for that purpose (one copy for the for last examin- official assignee, and the other for the proceedings) ; and the ation : last ex- jg^gj. examination of the bankrupt shall in no case be passed by amination will ^ ^ '■ ^ not otherwise the Court unless his balance-sheet shall have been duly filed as be passed : aforesaid ; office copies of the balance-sheet, or such part thereof office copies of '^ , ^ balance-sheet, as shall be required, shall be provided by the proper officer, or any part, to be provided by proper officer. Sect. 160. Advertisement of Certificate and Transmission to Chief Registrar, and Appeal against Allowance thereof. Advertisement LX. That the notice of the allowance of a certificate of 12 &'^l'3Vict conformity shall be advertised by the messenger of the court in c. 106, s. 199. the London Gazette ten days or more before the expiration of the time allovred by the statute for entering an appeal against the allowance, and such notice shall specify the class of the certificate and the time of suspension (if any) and the con- ditions (if any) annexed to the allowance : and no certificate of conformity shall be delivered to the bankrupt, except on pro- duction of the Gazette containing such advertisement. Certificate to be LXI. That after the expiration of the time allowed for transmitted to entering an appeal against the allowance of a certificate, and on chief registrar. ,..,.,, bemg satisfied that no appeal has been entered, the registrar of the court shall deliver such certificate to the bankrupt, and shall certify the allowance to the chief registrar. Deposit of costs LXII. That before any application for a recall of a certificate, tion fo^^ecau" ^"^ ^^^°^^ °^ ^* ^^^ *™^ °^ entering any appeal against the of certificate. judgment of the Court of Bankruptcy for the allowance of a 207^ and^see"^' ^^^^^°^^^' °^ ^°^ t^e refusal, the withholding, or the class of a sect. 12. certificate, or otherwise with respect to a certificate, the creditor or assignee or bankrupt intending to appeal, shall deposit with the chief registrar such sum, not being less than 10?. and not exceeding 40^, as the commissioner whose judgment is appealed from, or some other commissioner of the same court acting for AUCITS. 17 him, shall direct, in order to satisfy (so far as the same may extend) any costs that the appellant may he ordered to pay, and in the absence of any direction of a commissioner as to the amount of deposit, the sum of 201. shall be so deposited. LXIII. That at the time of entering an appeal against the Notice to the judgment of the Court for the allowance of a certificate, or for j_ g^^.^ joe" the refusal, the withholding, or the class of a certificate, notice thereof shall be given to the Court by leaving the same in writing with the chief registrar, who shall forthwith enter in the certificate-book the time and nature of every such appeal, and shall afterwards enter in the said book the date and substance of any order made in the said appeal that may be produced before him. LXIV. That all affidavits to be made in support of petitions Affidavits in of appeal against the allowance, refusal, or withholding of any gieJ ^ith'peti- bankrupt's certificate or the class thereof shall be filed at the tion of appeal. time of the filing of such petition of appeal. Audits. LXV. Every bill of fees and disbursements, and charges of Bills of solici- any solicitor or attorney, or messenger, under any commission, ^"^ and mes- fiat, or petition for adjudication of bankruptcy, incurred prior to delivered to re- any sitting for au audit, shall be delivered to the registrar for S'ftrar for tax- , ^ ° ation five days taxation five days at least before the day appointed for such before the sitting ; and in default thereof, if such sitting shall be adjourned ^j?''' I^/"^'* " . adjourned by by reason of such default, such solicitor or attorney, or messen- default of soli- ger, shall pay the costs occasioned by the adjournment, and the "tor or messen - amount thereof shall be deducted from the amount of such bill ; behalf, the soli- and no money shall be paid to any solicitor or attorney, or "torormessen- •' '^ ' _ ■' ger to pay the messenger, on account of any fees or disbursements or charges of costs of the ad- any bill, untU such bill shall have been taxed. journment: no ■' sum to be paid to any solicitor or messenger on account of his bill until it has been taxed. LXVI. The audit account of the official assignee, or of any Audit account creditors' assignee or assignees, shall be made out in the . °^'^^^ ^^- ° . signee or credi- ordinary form of a debtor and creditor account, each item thereof tors' assignee being entered according to its date, and a name, date, and propsr '" ^® ""^^^ 5|"' c li SUMMONING OF TRADER. form, to be uni- form in all the courts. explanation given to such item ; and a duplicate of such account shall be sent by the official asignee to the solicitor, two days at least prior to the day appointed for the auditing of such account, subject to the power of the commissioner to require an account, digested under proper heads, to be annexed to the audit account, if he shall think proper. At every audit the debtor and property book of the official assignee to be examined and compared with audit paper ; cause of monies LXVII. At every audit the debtor and property book exhibited to the Court by the official assignee, shall be carefully examined and compared with the debts and property collected, as stated in the audit paper, and the cause of any monies remaining uncol- lected shall be ascertained, and a minute thereof made, and filed with the proceedings ; and all persons appearing to be indebted remaining un- to the bankrupt's estate shall be forthwith summoned and asceTtalned and c^S-D^ined in that behalf upon oath, and the examination so taken a minute there- shall be filed with the proceedings ; and such directions shall be filed with oro- S'^^'* by the Court as to any further proceedings thereupon ceedings : the as to the Court shall seem fit. debtors to be summoned and examined on oath, and examination filed : Court to give directions as to further proceedings against such debtors. Summoning of trader debtors. 12 & 13 Vict, c. 106, sects. 78 to 86. Particulars of demand and notice^ how to be signed. N.B.— The pai-ticulars of demand and notice must be a copy of the particulars of demand and notice required to be annexed to the afSdavit of debt. How such par- ticulars of demand and notice should be directed. Summoning of Trader. Sections 78 to 86. LXVIII. That the particulars of demand and notice under the Bankrupt Law Consolidation Act, 1849, and specified in Schedule G to the said Act annexed, shall, where the debt is claimed to be due to a person or persons not in partnership, be signed by or in the Christian name and surname of every such person, adding after his signature, his description, residence or place of business, and shall, where the debt is claimed to be due to a partnership firm, be signed by or in the name of one of the partners on behalf of himself and partner or partners, adding after such signature the style or firm of partnership and place of business as follows (that is to say) : John Thompson for self and partners, trading under the style or firm of at in the county of LXIX. Such particulars of demand and notice shall be directed to the party or parties intended to be summoned by the Christian and surname of each of them (or where the Christian SUMMONING OF TRADER. VJ name is not known, by the surname only, or when the Christian name is indicated only by any initial or contraction, then by such initial letter or letters or contraction of the supposed Christian name, and by the surname), and also by the place of residence or business, and shall also contain in the body thereof a statement of the name or names with such initial or initials or contraction as above mentioned, if the name is not known, of all the persons from whom the debt is claimed to be due, whether the whole of them shall be summoned or not, or (in case of partners) the style or firm of partnership and place of business, in the same form as above mentioned. LXX. The account in such particulars of demand shall be The account to expressed with reasonable and convenient certainty as to dates ^? expressed ,. . . . with reasonable and all other matters, and where credit is given in such account to certainty as to the debtor, the notice shall require payment of the difference or ^^}^^' *"'•' ^^^ where credit is balance only which appears to be due in such account. given in the ac- count, payment of the balance only to be required in the notice. LXXI. If the affidavit of debt under the said Act shall not If affidavit for be filed within one calendar month after service of the par- !rS.'"°°"!.^fli a ticulars of demand and notice, the plaintiff (or creditor) shall not within a certain afterwards be at liberty to proceed without serving; new particulars f.' , „ •' ^ or particulars ot of demand and notice. demand and notice required. LXXII. Every affidavit for summoning a debtor under the Affidavit of said Act shall state the nature of the debt with the same degree debt, what cer- ° tamty required of certainty and precision as is now or shall hereafter be re- in. quired in an affidavit to hold to bail by order of a judge in the superior courts at Westminster. LXXIII. Every summons of a debtor under the said Act shall The parties, describe the parties in the same manner as they were described scrii,ea in sum- in the particulars of demand and notice. mons. LXXIV. Every such summons shall be- endorsed with a notice Notice to be , „ endorsed on as follows : summons in the form given, to " Notice to the party summoned." make known to the party sum- This summons is served upon you pursuant to the provisions of moned the pro- the Bankrupt Law Consolidation Act, 1849, and is founded on an ^^j relatinc c 2 thereto. See sects. 78 to 86. 20 SUMMONING OF TRADER. affidavit of debt which was filed in the Court of Bankruptcy in London, or the Court of Bankruptcy for the district, at on the day of 18 If you shall fail to appear to this summons at the time and place within specified, having no lawful impediment made known to and proved to the satisfaction of the said Court, and allowed, and if you also fail within seven days after personal service of this summons, or within such enlarged time as the said Court may grant, to pay, secure or compound for the demand within mentioned to the satisfaction of the summoning creditor, or enter into a bond in such sum, and with two sufficient sureties as the Court shall approve of, to pay such sum as shall be recovered in any action which shall have been brought, or shall thereafter be brought for recovery of the same, together with such costs as shall be given in such action, you will be deemed to have committed an act of bankruptcy on the eighth day after the service of this summons, provided a petition for adjudication of bankruptcy shall be filed against you within two calendar months from the filing of the above-mentioned affidavit. If you shall appear, and on appearance, or at any enlargement or adjournment of the summons, shall refuse to sign an admission of the said demand in the form required by the said Act, and shall not make a deposition on your oath in the form required by the said Act, that you believe you have a good defence upon the merits to such demand or some part thereof, and shall not (if required by the Court so to do) enter into a bond according to the form contained in Schedule K to the said Act annexed, in such sum and with such two sufficient sureties as the Court shall approve of, to pay such sum or sums as shall be recovered, together with such costs as shall be given in any action which shall have been or shall be brought for the recovery of such demand or of any part thereof, in respect of which such deposition shall be made, and shall also fail within seven days after personal service of this summons, or within such enlarged time as aforesaid, to pay, secure or compound as above mentioned, or to enter into such bond as first above mentioned, the same consequence will follow as in the case first supposed, subject to the same proviso as regards the filing a petition for adjudication of bankruptcy. If you shall appear, and on appearance shall sign and file an admission of the said demand, and shall not within seven days next after the tiling of such admission pay or tender and offer to STJMMONING OF TRADER. 21 pay to the said creditor the amount of such demand, or secure or compound for the same to the satisfaction of such creditor, you will be deemed to have committed an act of bankruptcy on the eighth day after the filing of such admission, subject to the same pro- viso as before mentioned with regard to the filing a petition for adjudication of bankruptcy. If you shall appear, and on appearance shall sign an admission for part of the said demand, and shall not make a deposition upon oath in the form required by the said Act, that you believe you have a good defence upon the merits to the residue, and shall not (if required by the Court so to do) enter into such bond as aforesaid, to pay such sum or sums as shall be recovered in any action which shall have been brought or shall thereafter be brought for the recovery of such residue, together with such costs as shall be given in such action, then, if as to the sum so admitted you shall not within seven days next after the filing of such admission, pay, or tender and offer to pay to the said creditor the sum so admitted, or secure or compound for the same to the satisfaction of such creditor, and as to the residue of such demand, shall not within seven days from the service of the summons, or such enlarged time as may be granted by the said Court in that behalf, pay, secure or compound for the same to the satisfaction of such creditor, or enter into a bond in such sum, and with such two sufficient sureties as the Court shall approve of, to pay such sum as shall be recovered in any action which shall have been brought or shall thereafter be brought for recovery of the same, together with such costs as shall be given in such action, you will be deemed to have committed an act of bankruptcy on the eighth day after the service of this summons, subject to the same proviso as before mentioned vi'ith regard to the filing a petition for adjudication of bankruptcy. If you shall appear, and on appearance shall, as to the whole of the said demand or part of it, make a deposition on your oath (in the form required by the said Act) that you believe you have a good defence upon the merits to the same and (if required by the Court so to do) enter into such bond according to the form contained in Schedule K in such sum and with such sureties as aforesaid, you will be entitled to a discharge from the summons. You are, moreover, to observe, that an admission made by you after the service of this summons, though signed elsewhere 22 SUMMONING OF TBADEK. than before the Court, may afterwards be filed in court, and will be as effectual as if you had appeared and signed it in court, provided such admission be made in the form contained in Sche- dule L to the said Act annexed, and there be present at the time of the signature an attorney of one of her Majesty's superior courts of law on your behalf, expressly named by you and attending at your request, to inform you of the effect of such admission before it is signed by you, and 'provided also that such attorney do subscribe his name to the admission as a witness to the due execution thereof, and in such attestation declare himself to be attorney for you, and state therein that he subscribes as such attorney. Summons to be LXXV. Every summons of a debtor under the said Act shall be endorsed with endorsed with the name and place of business of the attorney the name of the '^ •' attorney suing actually suing out the same, but in case no attorney shall be out the same, employed for the purpose, then with a memorandum expressing or with a me- ^ •' r r ' r a morandum ex- that the same has been sued out by the summoning creditor " in pressing that it person." was sued out by *^ "" the creditor iu person. Summons to be LXXVI. Every such summons shall be served four days at j^'^'^t"^'""^ least before the time for appearance therein mentioned. dai/s before ^^ timefor appearance. Summons to be LXXVII. Every such summons shall be served between the 9 o'clock A M I'ours of nine o'clock in the forenoon and nine o'clock in the and 9 o'clock afternoon. P.M. If plaintiff LXXVIII. If the plaintiff (or summoning creditor) shall make Stppelra?c''e, ^^^^^^^ ™ appearance by himself or his attorney at the time the defendant appointed in that behalf, the defendant (debtor) shall be entitled chargffrom''' *° ^^^ discharge from the summons, and a memorandum of summons, &c. such discharge shall be endorsed on the summons. If defendant LXXIX. If the defendant or party summoned shall appear at sucrcaslra".'" *^^ '^■'"^ appointed in that behalf, or at any enlargement or ad- titled to dis- journment thereof, and shall refuse to admit such demand, but Bummon™" ^^'^^^' ^^ '° ^^^ "^^°^^ °^ *^^ ^^^^ demand, or part of it, make a deposition as required by the said Act, that he believes he has a good defence on the merits to the same or some part thereof, and if ordered by the Court so to do, but not otherwise, enter into such bond according to the form contained in Schedule K in SUMMONING OF TRADER. 23 such sum and with such two sufficient sureties, and within such time as the Court shall approve of and direct, the defendant shall be entitled to his discharge from the summons, and a memo- randum of such discharge shall be endorsed on the summons. LXXX. Any want of compliance on the part of the plaintiff Want of ^otn- with these rules and orders in the particulars of demand and no- these rules, con- tice, and in the affidavit for summoning the defendant, and in sequence of. the summons and service thereof, or in any or either of such matters, may be waived by the defendant, or allowed to be rectified by the Court, when it shall not in the opinion of the Court be matter of substance, or shall have arisen from a mere slip ; but unless waived by the defendant, or rectified with the consent of the Court, if the same shall be made known to and proved to the satisfaction of the Court, at the time required by the summons for the appearance of the defendant, it shall be deemed and taken to be a good objection to requiring the defendant to state whether or not he admits the demand sworn to by the plaintiff or any part thereof; and in such case the defendant shall be entitled to his discharge from the summons with costs, and a memorandum of such discharge shall be endorsed on the summons. LXXXI. Every application to enlarge the time for calling Application to on the defendant to state whether or not he admits the demand «"'"S« *""«• or any part thereof, or for entering into a bond with sureties, shall be supported by affidavit. LXXXII. Before any defendant shall be allowed to enter into Notice to be a bond with sureties, according to the provisions of the said Act, fg^^"„*]5/;ntg„ he shall give to the plaintiff or his attorney two clear days' tion to enter notice in writing, signed by the defendant or his attorney, of mto bond, the defendant's intention so to proceed. LXXXIII. Such notice of sureties shall be accompanied with Notice of sure- a true copy of their affidavit of sufficiency, which affidavit shall co^pan'le/with be in the following form, viz. : — copy affidavit of . , „ J. sufficiency. In the Court of Bankruptcy, London, or m the Court ot porm of affida- Bankruptcy for the district. "i^ "f s"®- "^ ■' ciency. Between and A. B., of in the &c., andC. D., of &c. [adding their place of residence and description respectively]. 24 SUMMONING OF TRADER. severally make oath and say, and first the said A. B. for himself saith, that he is one of the proposed sureties for the above-named defendant, and that he the said A. B. resides at • afore- said, and that he is worth property to the amount of £ over and above what will pay and satisfy all his just debts and incumbrances ; that he is not surety in any manner for the above- named defendant or any other person, except on the present occa- sion [or if he is surety on any other occasion, substitute for the words in italics, the following : " and every other sum for which he is now surety"'] ; that his, the said A. B.'s property, to the amount aforesaid, consists of [here specify the nature and value of the property, according to the circumstances of the case, as fellows'] : stock in trade in his business of a carried on by him at of the value of of good book-debts, owing to him to the amount of furniture in his house at of the value of of a freehold or leasehold farm of the value of situate at occupied by [or of other property, particularizing each description of property, with the value thereof]. And the said A. B. further saith, that for the last six months he^has resided at aforesaid [or if he has resided at several places, then say, at the following places, particularizing them]. And the above-named deponent, C. D., for himself saith, that [here pursue the same form as with respect to the former surety] . Sureties to LXXXIV. The amount of property so sworn to shall be at imomit"'' ^' ^^^^'^ eqa&\ to the sum demanded or the portion thereof for which the bond is ordered to be given [fractional parts of a pound excepted], and one-fourth more. Liberty to except to sureties. LXXXV. The plaintiff shall be at liberty, within four days after service of notice of sureties, to except to the proposed sureties, or either of them, by delivering a written notice to the defendant or his attorney, to the effect generally that he excepts to such surety or sureties [as the case may be] , and a copy of such notice shall be served on the registrar of the court in which such exception is to be heard, two days at least before the day of hearing. Attendance in LXXXVI. Two days after service of such notice of exception, court to justify ^^xe defendant or his attorney shall attend before the commis- ARRANGEMENTS. 25 sioner of the day in London at three o'clock in the afternoon, a"d opposition or if in the country, at such time as the Court shall appoint, with the bond duly stamped, and with an affidavit by the subscribing witness of the execution of such bond, and the plaintiff or his attorney shall be at liberty to oppose the sureties, or either of them, upon affidavit, or on the ground of any defect appearing on the face of the proceedings. LXXXVII. The bond shall in all cases be taken in a penal Penalty of the sum to the amount of double the sum demanded, or the part ^^ ""^ ^""^ *^°^'" thereof in respect of which the bond is to be given, up to the sum of 1,000/.; and beyond 1,000?. in the sum of 1,000/. beyond the sum demanded. The condition of the bond is to be according to the form con- tained in Schedule K to the said Act. LXXXVIII. Where no notice of exception is served, the Where no defendant or his attorney shall attend before the commissioner Hon'^^ourse of of the day on the sixth day after service of notice of sureties, at proceeding, eleven o'clock in the forenoon in London, or if in the country, at the hour appointed by the Court, with the bond and affidavit of execution aforesaid, and also with an affidavit of service of notice of sureties, and an office copy of the affidavit of sufficiency. Arrangements between Debtors and their Creditors, under the superintendence and control of the Court. LXXXIX. That every petition shall be delivered fairly written Presentation or printed on parchment, properly stamped, between the hours ^^ petitions of eleven and two, to the registrar of the day in London, or to 12 & 13 Vict. the registrar or one of the registrars in the country (as the case g^j fQ'2^23 may be in town or in country), who shall file and number such petition, and allot the same by ballot, in the presence of a com- missioner, to one of the commissioners of the Court of Bank- ruptcy in London (or to a commissioner in the country where there are twocommissioners), and forthwith certify to such commissioner the filing of the petition and the allotment to him, and the petition shall be prosecuted before such commissioner (or before the sole commissioner where there is only one) : Provided always, that any one commissioner of the same court may, in the absence of 26 ARRANGEMENTS. any other commissioner, act for him : Provided also, that where a petition shall have been previously filed by the same peti- tioner, vehether the same shall have been dismissed or not, or when the petitioner has previously been bankrupt in London, or within the same district in the country, the new petition shall be allotted to the same commissioner to whom the former petition, commission, fiat, or petition for adjudication was allotted. Two copies to XC. That two fair copies on paper of the petition shall be be delivered to delivered to the registrar, together with the original petition ; regis rar. ^^^ ^^^ ^^^ ^^^ ^^ ^^^ commissioner, the other for the use of the official assignee and for the inspection of creditors. Deposit with XCI. That the sum of 10?., or such other sum, not exceeding official assignee, ^qj^ ^^ ^^^ commissioner shall direct, shall, before the appoint- ment of any sitting of the Court under such petition, be deposited vrith such official assignee of the commissioner to whom the petition shall be allotted, as he shall direct, for the costs of the sitting or sittings, for the payment of such remuneration to the official assignee as the commissioner shall award for the exami- nation of the accounts, and for other necessary expenses, and the residue, if any, shall be repaid to the petitioner. Certificate of XCII. That in all cases where a petitioner shall be in custody, causes of deten- tjjgjg shall be filed with his petition a certificate from the ffaoler tion to be an- nexed to peti- tion. or officer, of the cause or causes of the detention of the peti- tioner. Sending and serving of notices. XCIII. That all notices required by or given in pursuance of the provisions of the Act with respect to the said arrangements, except where otherwise directed by the Act, or by the Court, shall be sent or served [as the case may require'^ by a mes- senger of the Court. Petitioner's account to be attested and furnished to official assignee. XCIV. That the account to be filed by the petitioning trader shall be signed in the presence of and attested by a solicitor of the Court of Bankruptcy, and that the copy to be furnished to the official assignee shall be so furnished ten days or more before the day appointed for the private sitting of the Court. FORM OF ORDER. 27 XCV. That no person not bemsr or not claiming to be a ^), or at any time afterwards, had any disposing power which which the order jjg might, without the assent of any other person, exercise for his own benefit ; to hold to him the said goods and chattels as his proper goods and chattels, and to hold the said lands, tenements, rectories, tithes, rents, and hereditaments respectively, according to the nature and tenure thereof, to him and to his assigns, until the said two several sums of £ and £ together with interest upon the said sum of £ at the rate of 41. (c) The day on per centum per annum from the day of (c), and Toi'Lolif ""^ ^' on the said sum of £ at the rate aforesaid, from the was made. ' (d) The date of day of (d) shall have been levied : Therefore we the allocatur. command you that without delay you cause to be delivered to the said A. B. by a reasonable price and extent, all the goods and chattels of the said C. D. in your bailiwick, except his oxen and beasts of the plough ; and also all such lands and tenements, rectories, tithes, rents, and hereditaments, including lands and hereditaments of copyhold or customary tenure, in your bailiwick, as the said C. D. or any person or persons in trust for him was or were seised or possessed of on the said day of (e) The day on (e), or at any time afterwards, or over which the said C. D. on which the order jhe said day of (/), or at any time was made. ■'. . w /> j if) The day on afterwards, had any disposing power which he might, without which the order the assent of any other person, exercise for his own benefit ; to hold the said goods and chattels to the said A. B. as his proper goods and chattels, and also to hold the said lands, tenements, rectories, tithes, rents, and hereditaments respectively, according to the nature and tenure thereof, to him and to his assigns, until the said two several sums of £ and £ together with interest aforesaid, shall have been levied. And in what manner you shall have executed this our writ make appear to us in our Court of Bankruptcy aforesaid immediately after the exe- cution thereof, under your seal and the seals of those by whose oath you shall make the said extent and appraisement. And have there then this writ. Witness FORMS OF WRITS. 51 No. 9. Writ 0/ Elegit on an Order for Payment of Costs to be taxed. Victoria, &c. — To the sheriiF of greeting : Whereas lately, in our Court of Bankruptcy, in a certain matter there depending, intituled. In the matter of E. F., by an order of our said Court made in the said matter and bearing date the day of it was ordered that CD. should pay unto A. B. certain costs as in the said order mentioned, and which costs have been taxed and allowed by G. H., Esq., the Master of our said Court, at the sum of £ as appears by the certificate of the said Master, dated the day of And afterwards the said A. B. came into our said Court of Bankruptcy, and according to the form of the statute in such case made and provided, chose to be delivered to him all the goods and chattels of the said C. D. in your bailiwick, except his oxen and beasts of the plough, and also all such lands, tenements, rectories, tithes, rents, and hereditaments, including lands and hereditaments of copyhold or customary tenure, in your bailiwick, as the said C. D., or any one in trust for him, was seised or possessed of, on the day of in the year of our Lord (a) or at any time afterwards, or over (a) The date of which the said C. D. on the said day of (i) or at ">« »'l»'=at'^>-- any time afterwards, had any disposing power, which he might, t^e Master's without the assent of any other person, exercise for his own certificate of benefit ; to hold to him the said goods and chattels, as his proper goods and chattels, and to hold the said lands, tenements, rectories, tithes, rents, and hereditaments respectively, according to the nature and tenure thereof, to him and to his assigns, untU the said sum of £ together with interest thereon at the rate of 41. per centum per annum, from the said day of (e) shall have been levied. Therefore we command (c) The date of you that without delay you cause to be delivered to the said A. B. ^ * locatur. by a reasonable price and extent, all the goods and chattels of the said C. D. in your bailiwick, except his oxen and beasts of the plough ; and also all such lands and tenements, rectories, tithes, rents, and hereditaments, including lands and heredita- ments of copyhold or customary tenure, in your bailiwick, as the said C. D., or any person or persons in trust for him, was or were seised or possessed of on the said day of (d) or at (<^ The date of „ the allocatur. E 2 52 PAYMENT OF COSTS. (e) The date of the allocatiiT. any time afterwards, or over which the said C. D., on the said day of (e), or at any time afterwards, had any disposing power, which he might, without the assent of any other person or persons, exercise for his own benefit ; to hold the said goods and chattels to the said A. B. as his proper goods and chattels, and also to hold the said lands, tenements, rec- tories, tithes, rents, and hereditaments respectively, according to the nature and tenure thereof, to him and to his assigns, until the said sum of £ together with interest as aforesaid, shall have been levied. And in what manner you shall have executed this our writ, make appear to us in our Court of Bankruptcy aforesaid, immediately after the execution thereof, under your seal and the seEils of those by whose oath you shall make the said extent and appraisement. And have there then this writ. Witness Course of priority for payment of the costs of the petitioning creditor. 12 & 13 Vict, c. 106, B. 114. Course of Priority of Payment out of the Estate of the Bank' Tupt, of the Costs of the Petitioning Creditors, Sect. 1 14, and of payment of Costs out of joint or separate Estates. CXIV. That after payment or retainer out of the estate of the bankrupt of all monies duly paid by the official assignee, the per-centage on the gross produce of the estate, from time to time payable to the credit of " the chief registrar's account," and afterwards the per-centage payable to the official assignee in respect of realizing the property, the costs of the petitioner of filing and prosecuting his petition until the choice of assignees by the creditors shall be paid as follows : first, the costs and charges of the messenger and broker acting under the petition to the time of the choice of assignees, and then the costs and charges of the solicitor acting in the matter of the petition until the said time. In case joint CXV. That in case any joint estate of any bankrupts shall dent^ Court" ^^ insufficient to pay any costs or charges necessarily incurred may order costs in respect of the same, the Court may order such costs to be paid seoMat^e estate °^^ °^ ^^^ separate estates of such bankrupts, or one or any of and vice versS. them ; and vice versd may order costs necessarily incurred for DUTIES OP OFFICIAL ASSIGNEES. 53 any separate estate, if the same were incurred with reasonable probability of benefit to the joint estate, to be paid out of such joint estate. Composition after Adjudication of Bankruptcy, under Sections 230, 231. CXVI. That at the first of the meetings of creditors directed Minutes of first by the statute to be held, a minute shall be taken by the ^'^js'-yjct solicitor to the assignees, of the names of the several creditors c. 106, ss. 230, • • • 231 present, and the amount of their several debts standing in proof upon the proceedings, distinguishing such of them as shall assent to such composition. CXVII. That the second of the said meetings shall be held Second meet- before the commissioner, and that at such meeting the said '"£*°i„!:„^°'^ commissioner shall, by deposition of witnesses and documentary evidence, as to him shall appear to be proper, inquire and ascertain, whether the several particulars directed by the statute to be performed previous to the holding of such second meeting have been duly performed, and certify the same, together with the proceedings which shall have taken place at such second meeting. CXVIII. That for the better information of all parties inter- Certificate of ested, the certificate of the commissioner shall state what pro- commissioner, portion in number and value the creditors assenting to the composition bear to the creditors who shall have proved debts to the amount of 20/. and upwards under the fiat, or petition, and also whether any sale has been made of the bankrupt's estate, in order that provision may, if expedient, be made for confirming the same. With respect to Official Assignees and their Duties. CXIX. That each commissioner shall appoint his official Appointment assignees where more than one is attached to his court, to act ere'^*f"ffi'*^jd" in rotation under the several bankruptcies prosecuted before him; assignees to act. 54 DUTIES OF OFFICIAL ASSIGNEES. unless in any case the commissioner shall see cause to the contrary. Same as to CXX. That the same rule for the appointment of official missions and" assignees shall be followed as to existing commissions and flats. fiats issued before the 11th October, 1849, under which no official assignee has been appointed. Appointment of CXXI. That the appointment of any official assignee to any the'certificate bankrupt's estate shall be under the hand of the commissioner, thereof. and shall remain of record in the said Court of Bankruptcy ; and certificates of such appointment, under the seal of the Court, shall be delivered to such assignee by the registrar upon appli- cation for the same. Official CXXII. No official assignee shall either directly or indirectly t^^!f "^f ""' '" carry on any trade or business, or hold or be engaged in any office or employment other than his office of official assignee. Official CXXIII. Each official assignee shall find sureties to the extent Sks! '° '''"' °^ 6,000/., and shall together with such sureties (except where otherwise especially directed by any three commissioners, of whom the senior commissioner shall be one) execute a joint and several bond to the chief registrar for the time being in the penal sum of 6,000/. Liability of CXXIV. Each official assignee to be made liable to the whole afd suretief^^ amount, and the sureties to be liable together to the like amount, in such proportions as shall be approved of by such three com- missioners, provided that no one surety shall be liable for more than 3,000/. nor less than 1,000/. The official CXXV. That each official assignee shall, on the 1st day of auTtTmake"" January in every year, or within one week then next following, declaration that make a declaration in writing, to be filed with the chief registrar, thetel'rfhis'' *^^* *° *^^ ^^®* °^ ^^^ knowledge and belief his sureties are belief, are alive alive and solvent ; and in such declaration state, to the best of ^dllsoTtate ^'® knowledge and belief, any change of residence of any or any change of eitheir of such sureties. residence. Official CXXVI. Each official assignee shall, on pain of dismissal give assignee to give ° DUTIES OF OFFICIAL ASSIGNEES. 55 immediate notice in ■writing, to the chief registrar, of the death, notice of death, bankruptcy, or insolvency of any or either of his sureties ; and S™nc7o7 shall, if required, cause a new bond to be executed to the like his sureties, amount by another surety or sureties, to be approved of as above. CXXVII. Each official assignee shall follow the instructions Official of the commissioner under whom he acts. assignee to touow the in- structions of the commissioner. CXXV^III. That no official assignee shall keep under his No official control upon any one estate more than 100/. ; or, in the aggre- under Ws "con™ gate of monies of bankrupts' and petitioning debtors' estates, trol more than more than 1,000Z. ; and any excess beyond such sum shall be any one" estate paid by him forthwith into the Bank of England. or in the aggre- gate more than 1,000Z. CXXIX. That the official assignees, at the time of paying Form to he monies into the Bank of England, shall state in writing, adopted on pay- ° ment of money delivered therewith to the cashier of the Bank, in the form into the Bank specified in the schedule hereunto annexed (No. 4), the date by an official assignee. and amount of the payment, the name of the official assignee making it, the name and description of the bankrupt or bankrupts to whose estate the money belongs, and that it is to be placed to the credit of the Accountant in Bankruptcy ; and the official assignee shall take a receipt for the same from the cashier of the Bank, and on the same day carry or transmit it to the office of the Accountant in Bankruptcy, who wiU give a proper voucher for such receipt, and that the money is placed to the credit of the estate of the said bankrupt, or bankrupts, in the books kept in the office of the Accountant in Bankruptcy, such voucher to be produced when called for by the Court. CXXX. That the allowance to be made to the official assignee Allowance of shall be upon the following scale : subject to variation in any °™"*' particular case, and for special cause to be assigned by the com- missioner in writing, and filed with the proceedings. SCALE. That there be paid to each official assignee for the examination of the bankrupt's accounts, such sum as the commissioner shall think fit, not exceeding 20?. for the accounts of one bankrupt, nor exceeding 201. for the joint estate of two or more bankrupts ; 56 DUTIES OP OFFICIAL ASSIGNEES. and not exceeding 10/. for each separate estate, administered under the same adjudication. For every debt collected 5 per cent, on the first amount of 100/. or any less sum ; 2|- per cent, on the next amount of 400?. or any less sum ; 1 per cent, on the next amount of 500/. or any less sum ; and |- per cent, on all further sums. For property realized 2j per cent, on the first amount of 500/. or any less sum ; 1 per cent, on the next amount of 500/. or any less sum ; and J per cent, on all further sums. On dividend 2 per cent, on the first amount of 1,000/. or any less sum, actually divided ; and 1 per cent, on all further sums. The per-centage on mortgaged property to be calculated only on the residue payable to the bankrupt's estate. For drawing every dividend warrant, or renewed dividend warrant, sixpence. Note. — At the expiration of twelve montlis after these orders come into operation, this scale will be revised by the commissioners (subject to the approval of the Lord ChanceEor), regard being had to the amomit of remuneration received by the official assig- nees in the preceding twelve months. Official assignee CXXXI. That the official assignee shall enter in a book, to be terrf" thebank- °^^^'^ *^® register estate book, the names of the bankrupts in the ruptcies to Commissions, fiats, and petitions to which he shall have been or bet^Joi. ^^^^-PP°-ted. Particular sets CXXXII. That the official assignee shall keep the following of books to be /:t.i-. jri/- kept by the ^^t ot books, in size and form heretofore used ; that is to say, official register estate book (No. 1); register book of bankrupt's books delivered to official assignee under each estate (No. 2); debtor and property book; rough cash book; fair cash book; rough journal; fair journal (forbiUs of exchange, securities, &c.); ledger; letter book ; petty cash and postage book ; audit book. J^ffi^j^lassignee CXXXIII. That the official assignee, forthwith after his ap- number books, pointment under any bankrupt's estate, shall sort and number the &c. of bank- books, papers, and writings of the bankrupt, with the number of DUTIES OF OFFICIAL ASSIGNEES. 57 the estate, in the register estate book, and the number of each book, thus : — [54. (The number of the estate in the register estate book). 75. (The number of the book, paper, or writing received by the official assignee)] . and the official assignee shall file a list thereof, with the proceed- ings, and shall also forthwith after his appointment deliver to the bankrupt a written notice or letter in the form specified in the schedule hereunto annexed (No. 1). CXXXIV. That the official assignee shaU direct, in the form Official assignee specified in the schedule hereunto annexed (No. 2), the payment ^a'^^ent o? of aU monies due to any bankrupt's estate from any one person, monies due to or from two or more persons being partners, and carrying on * bankrupt s business or residing in England, and exceeding in amount the persons in sum of 500Z., and of aU monies being in the hands or under the England, and ° . exceeding a control of any assignee or assignees chosen by the creditors of certain sum in any bankrupt's estate to which such official assignee shall have amount t° te ^ '^ *-* ^ made direct been appointed, into the Bank of England, to the credit of the into the Bank accountant in bankruptcy, and for the particular estate to which of England. such money shall belong. CXXXV. That when any money shall be paid into the Bank Party making of England, pursuant to the directions aforesaid, the person so ™* Payment paying such money shall receive a certificate in the form speci- receipt for the fied in the schedule hereunto annexed (No. 3), from one of the ^^""®- cashiers of such Bank, of his paying the same, and of its being placed to the account of the Accountant in Bankruptcy for the proper estate, and a voucher for such payment shall be sent by the Bank on the same day to the said accountant. CXXXVI. That as soon as conveniently may be after every Accountant iu such payment, the Accountant in Bankruptcy shall certify in Bankruptcy to writing to the proper official assignee that such payment has payment to the been made, and the name of the bankrupt or bankrupts to the P'^op^'' official assignee. credit of whose estate the money has been placed m the books kept in the office of the Accountant in Bankruptcy. 58 DUTIES OF OFFICIAL ASSIGNEES. All monies under the con- trol of the official assignee to be kept at a banker's, to his account as official assignee, and not mixed with his own monies. CXXXVII. That all monies, without exception, received by the official assignee, and not paid by him forthwith into the Bank of England to the credit of the Accountant in Bankruptcy, shall be paid by the official assignee, as soon as they shall amount to lOOl. into the hands of a banker, with whom such official assignee shall keep an account as such official assignee, such account to be entitled as official assignee, and in which account no monies shall be entered, except such as are received by the official assignee in his official capacity, CXXXVIII. That all monies paid into the Bank of England to the credit of the Accountant in Bankruptcy, for the estate of any person adjudged bankrupt, or in matters of bankruptcy, shall be subject to the order of a commissioner of the Court of Bankruptcy, in writing under his hand, and testified by a registrar, as to the application thereof ; provided that every such order shall specify the amount of any payment to be made by such order, the purpose to which it is to be appHed, and the name of the official assignee or other person to whom the same is to be made for such purpose ; and in cases where the sum to be paid exceeds 500/. the name of the person beneficially entitled (to whom only in such case the payment shall be made), and the Accountant in Bankruptcy shall and may, pursuant to such order, pay the sum of money specified therein, out of such bankrupt's estate, by a draught, subscribed to, and on the same paper with the said order ; such order and draught to be in the form specified in the schedule hereunto annexed (No. 5). Orders for pay- CXXXIX. That all orders by the commissioner for payment &c"to°be"si"iSd °^ money, or for the transfer and sale (as hereinafter provided) in triphcate. of any stock or securities, being part of a bankrupt's estate, be signed in triplicate, and that one copy of any such order be filed with the proceedings in bankruptcy, and that one copy be left with the Bank of England, and that one copy be left with the Accountant in Bankruptcy. Official assignee CXL. That the official assignee shall, before any audit, enter book'thVnames ™ ^ ^°°^ ^^^ names of all the debtors to the bankrupt's estate, as of all debtors to returned in his balance-sheet, and shall state the reasons why estate^°and'^*'^ debts are not paid on the opposite page ; such book shall be pro- state therein duced to the Court at every audit. the reasons why debts are not paid, and to produce the book at the audit. Order for pay- ment of money out of the Bank of England under any bankrupt's estate to be made by a com- missioner in writing under his hand, and testified by a registrar ; the apphcation of the money to be specified in the order. DUTIES OP OFFICIAL ASSIGNEES. 59 CXLI. That each oflGicial assignee shall deposit in the Bank of Bills of ex- England, to the credit of the Accountant in Bankruptcy, all &c'!"to bedepo- bills, notes, and other negotiable instruments, except unaccepted sited in the bills of exchange, as soon as he shall receive the same ; and shall ^s°gneJs" &t"^ deposit in like manner all unaccepted bills of exchange as soon as the same shall have been accepted or refused acceptance ; and shall at the time of such deposit leave a statement in writing, with the cashier of the Bank of England, specifying the date and contents of the instruments so deposited, the name of the official assignee making such deposit ; the name and description of the bankrupt or bankrupts, and the particular estate to which the same respectively belong, and that such instruments respectively are to be deposited to the credit of the said Accountant in Bank- ruptcy ; and shall also take a receipt for the same from the cashier of the Bank, and carry or transmit it to the office of the said Accountant in Bankruptcy, who will give a proper voucher, to be produced when called for by the Court. CXLII. That when, and as soon as any bill, note, or other Bill, &c., when negotiable instrument, deposited as aforesaid in the Bank of ^j^^j ^^ " ^ England in the name of the said accountant, shall become due, the Governor and Company of the Bank of England shall, without any direction from the said accountant, deliver such bill, note, or other negotiable instrument, to one of the cashiers of the Bank, who is to present the same for payment, and receive the sum of money due thereon, and forthwith to pay the sum so received, if any, into the Bank of England, to be there placed to the credit of the said accountant. CXLIII. That in case any such bill, note, or other negotiable In case of non- instrument, shall not be paid, the said Governor and Company P^?™^" • ''• of the Bank of England shall cause such bill, note, or other ne- gotiable instrument as is by law required to be noted and protested, to be delivered to a notary for that purpose, and to be noted and protested accordingly, and shall, after the same shaU have been so noted and protested, as the case may be, again deposit the same in the Bank of England, to the credit of the said accountant. CXLIV. And that the said Governor and Company of the Bank of Bank of England forthwith, after every such receipt of money ^erfifTto ° 60 DUTIES OF OFFICIAL ASSIGNEES. accountant the receipt of money on bill, or dishonour, &c. or deposit of any note, bill, or other negotiable instrument, shall certify to the said accountant the sum of money received, if any, on each such bill, note, or negotiable instrument, and placed to the credit of the said accountant, or that such bill, note, or negotiable instrument, has been dishonoured ; and such dis- honoured biU, note, or other negotiable instrument, shall be forthwith delivered by the Bank to the proper official assignee. Official assignee to give notice of dishonour, &c. CXLV. And that as often as any bill, note, or other negotiable instrument, that shall have come to the hands of any official assignee, shall have been or shall be dishonoured, such official assignee shall forthwith give such notice thereof as is by law required from the holder of such bill, note, or other negotiable instrument respectively. Commissioner to order de- livery out of bills, notes, &c. to official assignee. CXLVI. That any one of the commissioners of the Court of Bankruptcy acting in the prosecution of any bankruptcy may, from time to time, make order relative to the delivery out to an official assignee of any bill of exchange or promissory note, which may stand in the Bank of England to the credit of the Accountant in Bankruptcy for the estate under such bankruptcy ; provided that the purpose of such delivery be stated in the order, and such order be attested by a registrar. Commissioner may order money to be invested in Exchequer- bills or sale of Exchequer- bills, &c. CXLVII. That any one of the commissioners of the Court of Bankruptcy acting in the prosecution of any commission, fiat, or petition for adjudication of bankruptcy, may, as often as it shall appear to him expedient, by order under his hand in the forms specified in the schedule hereunto annexed (Nos. 6, 7, and 8), direct any money, which may have been paid into the Bank of England on account of the estate of the bankrupt named in such commission, fiat, or petition, to be invested in the purchase of Exchequer-bills, to be lodged in the Bank of England, and may in like manner direct the sale or exchange of such Exchequer-bills, and also the exchange, sale, or transfer of any stock in the public funds, or in any public company, or of any Exchequer-bills, India bonds, or other public securities which sheJl have been transferred, deUvered, or paid into the Beink of England on account of such bankrupt's estate, and may direct the proceeds thereof to be laid out in the purchase of Exchequer- bills, and that such Exchequer-bills, when so purchased, be DUTIES OP OFFICIAL ASSIQNEHS. 61 deposited in the Bank of England, to the credit of the said accountant for such particular estate ; and the said accountant shall and may, pursuant to such order, make such sale, purchase, or transfer, without any further order or direction ; and the expenses thereof may he charged to the account of the estate for the benefit of which the same shall have been respectively made. Provided always, that the signature of the commissioner be attested by a registrar, and that the order of the Accountant in Bankruptcy be subscribed to the order of the commissioner, and on the same paper with the said order. Provided further, that no stock or public fund be transferred upon any sale, and that no Exchequer-biU, India bond, or pubHc security, be delivered for the purpose of sale, except to a cashier of the Bank of England, until the price or value thereof be paid into the Bank of England to the credit of the Accountant in Bank- ruptcy for the particular estate to which it belongs, and that no sum be paid for the purchase of any Exchequer-bOl, India bond, or other public security, until such Exchequer-bill, India bond, or public security be deposited in the Bank of England to the credit of the said Accountant in Bankruptcy, and for such particular estate. CXLVIII. That the official assignee shall forthwith after the The official declaration of a dividend, give notice by advertisement in the ncSceta'"^^^ London Gazette, and to each creditor, by a printed circular Gazette and to letter in the form specified in the schedule hereunto annexed j^° post°office (No. 9), to be sent through the Post-office at the the cost of a printed circu- the bankrupt's estate, to be settled by the commissioner, of the eh^- editor time and place of the delivery of the dividend warrants as giving him hereinafter provided; and that at such time the official assignee ?°'"^^nd lace will require the production of such securities, if any, as the of the delivery creditor exhibited at the time of his proof ; and that no dividend "^^^ dividend ^ warrant. warrant will be delivered to the creditor holding any security for his debt until such security shall be produced, without the special directions of a commissioner in that behalf. CXLIX. That when a dividend has been or may be declared. Payment of the solicitor to the estate shall forthwith make out three lists dividend. The duty of souci- tors. 62 DUTIES OF OFFICIAL ASSIGNEES. Duty of official assignee. Accountant's duty. of the creditors in alphabetical order, and shall state, in sepa- rate columns, after the name of each creditor, the amount of his debt and the dividend to which he is entitled, and in two of such lists the securities exhibited at the time of proof, and shall to each name prefix a number iu regular series, together with the date of the order of dividend, according to the form in the schedule here- unto annexed (Nos. 10 and 11), and shall sign such several lists, and deliver the same within four days after the declaration of such dividend to the official assignee, who shall cause one of the lists which specifies such securities to be filed with the proceedings, and shall examine and sign the several lists, if correct, and shall pre- pare books at the expense of the estate, containing as many blank warrants as may be necessary, according to the form in the sche- dule hereunto annexed (No. 12) for London, and (No. 13) for the country, and shall number and fill up a warrant for each dividend, and insert in each warrant the name of the creditor to which the number of such warrant is prefixed in the list, and the dividend payable to him, and shall keep one of the lists specifying the securi- ties in his custody, and shall take or send the books containing such warrants, together with the list not specifying the secu- rities, to the Accountant in Bankruptcy, who shall ascertain that the amount of such warrants does not exceed the sum standing in his name to the credit of the bankrupt's estate, and shall com- pare the warrants with the lists, and if correct shall certify the same, by affixing the seal of his office, to be provided for that purpose, in the margin of the warrants ; and he shall keep in his custody the list of creditors, and return the warrants to the official assignee, for delivery to the creditors as hereinafter mentioned. Official assignee's duty. CL. That when a creditor, or any person duly authorized under his hand to receive his dividend warrant, shall apply for the same, the official assignee shall require the production of such securities (if any) as the creditor exhibited at the time of his proof, and if satisfied that the amount of the said dividend still remains due, shall fill up the date in the warrant and receipt, and upon the creditor or such other person authorized as aforesaid signing the receipt, the official assignee shall mark the securities (if any) with the amount of that dividend, and shall sign and deliver the warrant for the same ; provided that no dividend warrant shall be delivered to any creditor holding any security for his debt DUTIES OP OFFICIAL ASSIGNEES. 63 until such security shall he produced ; provided that upon the statement of a creditor that he is unable to produce his security, and that the same has not been parted with for any valuable consideration, nor assigned to any person, he shall be examined on oath before a commissioner as to the cause of such inability, and his examination shall be filed with the proceedings, and the commissioner shall adjudge whether in his opinion the creditor is or is not able to produce the security ; and if the commissioner Commissioner is of opinion that the security cannot for a sufficient cause be ^° o™er pay- '^ ^ ment of divi- produced, the creditor shall give a sufficient indemnity to the dend in cases official assignee, to be approved by the commissioner, and upon '"^^'^^ securities . . . . . . cannot be pro- such indemnity being given the official assignee shall deliver the duced. dividend warrant to the creditor. CLI. That the payment of the dividend warrant may be Dividend war- obtained by the creditor, or any person duly authorized by him "^*° ' "''Pl- under his hand to receive his dividend, or by the executor or administrator of any such creditor, upon production of the divi- dend warrant at the office of the Accountant in Bankruptcy, or in a country bankruptcy, at any branch of the Bank of England, or such other bank as shall be named by the Bank of England in that behalf. CLII. That if any other person than the creditor or person When order of duly authorized by him, or the executor or administrator of any c""m'ssioner ' .... ■'tor payment of such creditor, claim to receive the dividend, the person so claiming dividend war- the same must obtain an order for payment thereof endorsed upon '^°'°'" the warrant by a commissioner under his hand ; and if any divi- dend warrant be above twelve months' date, a Uke order for payment thereof by a commissioner shall be required : provided always, that in no case shall any dividend warrant be paid to an official assignee unless such official assignee be the payee, or the executor or administrator of the payee, or the assignee of any bankrupt payee. CLIII. That when a dividend has been or may be declared Transfer of under any commission, fiat, or petition for adjudication, the """ney from •* . . . . , , general account commissioner acting in the prosecution of such bankruptcy may, to dividend by order under his hand, attested by a registrar, in the form *'=™"^'i'- specified in the schedule hereunto annexed (No. 14), direct the sum ordered to be divided, or such part thereof as may be re- 64 DUTIES OF OFFICIAL ASSIGNEES. Commissioners authorized to carry back dividend not called for to the original account of estate. quired, to be carried from the general account of such estate to an account to be kept in the books of the Accountant in Bank- ruptcy, entitled " The Dividend Account," and to the particular estate ; provided that when it shall appear that any part of the money directed to be applied in payment of any dividend is not called for to make such payment, the commissioner may, by order under his hand, testified as aforesaid, and in the forms specified in the schedule hereunto annexed (Nos. 15, 16, 17, 18, and 19, as the case may be), direct such sum to be carried back to the original account of the estate to v^hich it belonged. Unpaid divi- dend warrants of above twelve months' date to be returned to the Accountant in Bankruptcy by the official assignee, and cancelled. CLIV. That all dividend vi^arrants under any bankrupt's estate, which shall have been delivered to any official assignee by the Accountant in Bankruptcy for more than twelve calendar months, the same having been previously stamped by such accountant, but which shall not have been delivered to any creditor of such estate, shall forthwith, after the expiration of such twelve months, be brought or sent by such official assignee, together with two lists thereof, under each bankrupt's estate, to the said accountant, who shall thereupon compare the warrants with such lists, and cancel such warrants ; and one of such lists shall be certified by the said accountant, and returned to the official assignee, who shall file such list with the proceedings of the respective bank- ruptcies ; and the other of such lists to be retained by the said accountant. Official assignee to deliver quarterly ac- counts of balances, toge- ther with his cash-book and pass-book. CLV. That the official assignee shall once in every quarter of a year deliver to the Court to which he shall be attached, an account made up to the last day of the preceding month, together with his cash-book and banker's pass-book duly balanced, and any other books that the commissioner may require ; and such account shall show the balances placed to the credit of the Accountant in Bankruptcy, and of every estate under the charge of such official assignee in the books kept in the office of the Accountant in Bankruptcy, such balances to be certified by the said accountant ; and such account shall also show the balances of every bankrupt's estate then in the hands or under the power or control of the official assignee. The quarterly accounts to be kept by regis- CLVI. That such quarterly account shall be kept by the registrar of the court to which such official assignee shall be DUTIES OF OFFICIAL ASSIGNEES. 65 attached, and shall be open to the inspection of creditors ; and registrar of the 1 • 1 11 1 • • ..1 1 • court, and opea that notice shall be given in each court of such account having (.„ j^e inspec- been delivered, and that any creditor applying to the Court may *><"» of creditors inspect the same without fee at such convenient time as may ti^es. be appointed by the Court. CLVII. That all monies, bills of exchange, notes, and other Monies or .... ,.,,,. , , .. bills, &c., may negotiable instruments hereinbefore directed to be paid or j,g „^i^ ^^ jg. delivered to or by the Bank of England, may be paid or Hvered to the delivered to or by the Bank of England by or through any of the En„iand branch banks thereof, or any other bank that may be named by through any the Governor and Company of the Bank of England for that tanks thereof. purpose ; and all business arising in the country with the Bank of England may, where necessary or convenient, be transacted with the Bank of England by or through any of such branch banks, or other bank so named. CLVIII. That the several forms specified in the schedule Other forms in hereunto annexed for the several purposes therein stated, and j,g followed not hereinbefore referred to, be followed in all cases where the where appli- 1 I'll cable. same may be applicable. CLIX. That if the official assignee shall without good and suffi- Official assignee cient cause, to be allowed by the Court, keep under his control hiTcontrolmore more than 1001. of money belonging to any one estate, or more than lOOZ., than 1,000?. in the aggregate of monies belonging to bankrupts' ™^jg T/more estates, for more than one week, he shall be charged in his than 1,000?. in accounts by the commissioner with such sum as shall be equal ^ e aggrega e, to interest at the rate of 201. per cent, per annum, on the with 201. per excess of the said sum of 1001. or l.OOO;. as the case may be, e™ess°°and* for such time as such money shall be under his control beyond unless the the said week ; and, unless the money has been kept for good ^"^^l'^^^ ^^"^ and sufficient cause, allowed by the Court, the official assignee proper causes, shall be dismissed from his office, upon the report of the com- from h^^ office*^ missioner, or upon petition to the Lord Chancellor by the creditors' on the report assignee or assignees, or by any creditor, and be liable to the "^ '^® commis- ° ° ■^ ■> ' sioner, or upon costs and expenses, and have no claim to remuneration. petition to the Lord Chancel- lor by a creditor, and be liable to costs and expenses, and have no claim to remuneration. CLX. That all forms relating to the payment or delivery Forms relating into or out of the Bank of England of any money, bills, &/7f'^''°ne 66 DUTIES OF OFFICIAL ASSIGNEES. under bank- notes, or Other securities under bankruptcies, prosecuted in the cXt; to t: 'country, be printed in red ink. printed in red ink. Orders as to CLXI. That the orders hereby made as to official assignees undCTbank^^^ of the estate of bankrupts, and their duties and conduct, shall, so ruptcies to be far as the same are applicable, apply to and be observed by XcM^'signees o^cial assignees, appointed under petitions presented by debtors under petitions desirous of effecting arrangements with their creditors, under ment"™ c!' *^^ superintendence and control of the Court. Printed copies of CLXII. That printed copies of these rules and orders shall be plied bv chief*" supplied by the chief registrar, to the several Courts of Bank- registrar, &c. ruptcy in London, and in the country districts ; and also to the Accountant in Bankruptcy, the Governor and Company of the Bank of England, the Master in Bankruptcy, and each official assignee ; and that one such copy be posted up in some conspi- cuous place in every such court ; and in the respective offices of the chief registrar, the Accountant in Bankruptcy, the Master in Bankruptcy, and official assignees. Rules and CLXIII. That these rules and orders shall take effect from orders whGU to take effect. ^"^d after the 11th day of January, 1853, from which time all rules and orders made previous to the passing of the Bankrupt Law Consolidation Act, 1849, and the order made on the 12th of October, 1849, shall be and are hereby rescinded. Joshua Evans, Senior Commissioner. John S. M. FoNBLANauE, Edwabd Holkoyd, Edward Goulburn, Wm. Thos. Jemmett, M. B. Beee, Richard Stevenson, William Scrope Ayrton, H. J. Perry, Approved, St. Leonards, C. 19th Oct. 1852. ' Commissioners. 67 SCHEDULE OF FORMS. No. 1. Form of Letter to Bankrupt forthwith after Appointment of Official Assignee, gjjj {Residence and Date.) Having been appointed official assignee to your estate, I have to inform you that the Court requires you to make out and deliver to me imme- diately : — 1st. — A list of all your creditors, alphabetically arranged, and of liabilities on bills of exchange, as acceptor, drawer, or indorser, and any other engagement provable under your estate. If any creditor has received your acceptance or note of hand, or any other bai, with your name as drawer or indorser, or any other security, goods, or property, on account of'his debt, state the particulars against his name. This list is required within a week from tliis day. 2ndly. — A list of eJl the debtors to your estate. State the name and present residence of the dehtor, and the sum due, distinguishing those you consider to be bad or doubtful, or that are disputed. If the debtor has been bankrupt, state if the debt has been proved, and if any and what dividends have been received by you. If you hold or have received any security from the debtor, state its nature. 3rdly. — ^A statement of rent, taxes, and rates due by you up to the quarter- day preceding your bankruptcy, with an account of all sums due for salaries and wages, and the rate per year, month, or week. 4thly. — A statement of the probable value of your stock in trade, leasehold property in houses, lands, or buildings, or any other property in your possession or control, or in the possession of others, on which you have received any advances, or have an interest. State if the stock and premises are insured from fire, in what office, and to what extent, and when the insurance expires, and who holds the policy. 5thly. — A list of all books, papers, or documents belonging to your estate, such list to be verified on oath, specifying whether the same are already taken by the messenger, or are in your custody (in which case you are hereby required to deliver the same to me), or are in the custody of any other and what person, and under what right or circumstance. And the Court requires that you attend from day to day at my office, to make up and balance your books, and prepare a balance-sheet for the purpose of passing your last examination, and which must be filed at least ten days before the day appointed for the last examination, being the day of I remain. Sir, Your obedient Servant, To Mr, Official Assignee. F 2 68 No. 2. Direction from Official Assignee for Payment of Sums exceeding £500 in amount due to a Bankrupt's Estate into the Bank. Bankrupt Law Consolidation Act, 1849. By virtue of the general orders made under this Act, and bearing date the day of , I hereby direct you to pay the sum of £ due {or by the books and statements of the bankrupt hereinafter named, appearing to be due] from you to the estate of C. D., of a bankrupt, into the Bank of England, to the credit of the Accountant in Bankruptcy for the said estate. At the time of payment you will have a receipt from the Bank, which wUl be a sufficient discharge to you for the same. I am. &c. Official Assignee. To N.B. — It is of great importance that you should produce this letter to the Bank, or fill up the annexed form, when you make the payment. 69 No. 2 0. BANKRUPT'S ESTATES. London, or day of 18 Estate of of Official Assignee. A, B. of is desirous to pay into the Bank of England the sum of £ to the credit of Esq., Accountant in Bankruptcy for the above estate. Ent> Bank Clerk. To be sent or transmitted by the Bank forthwith to the Accountant in Bankruptcy, upon payment being made into bank. 70 Nos. 3 and 3 a. Certificate of Payment into Bank hy other than Official Assignees. BANKRUPT'S ESTATES. day of 18 Estate of I HEEEBY CERTIFY, that A. B. of has this day paid into the Bank of England the sum of £ to be placed to the credit of Esq., as the Accountant in Bankruptcy for the above estate. For the GovERisfOR and Company of the Bank of England. Cashier. Enti N.B. — This certificate to he retained hy party making payment 71 Nos. 4 and 4 o. Certificate of Payment into Bank by Official Assignee. BANKRUPT'S ESTATES. day of 18 I HEREBY CERTIFY, that Mr. E. F., official assignee of the estate has this day paid into the Bank of England Esq., as the of bankrupt the sum of £ to be placed to the credit of Accountant in Bankruptcy. For the Governor and Company of the Bank of England. Cashier. Enfi N.B. — This certificate to be sent forthwith to the Accountant in Bankruptcy by the official assignee, upon payment being made into bank. 72 Nos. 5 and 5 a. Order for Payment of Money. BANK. IN THE COURT OF BANKRUPTCY. Basinghall-street, London, day of 18 Before Mr. Commissioner In the matter of I certify that by It appearing to me, by the annexed certificate, that my boolts the sum of £ stands the sum of £ stands above esute in the ^° *^^ credit of the above estate, and that the sum of books of the Account- £ ig required for ant in Bankraptcy. „„.,.. the I therefore Oincial Assignee. order the said sum to be paid to out of the monies standing to the credit of the Ac- countant in Bankruptcy, in the books of the Bank of England. Commissioner. Reg. Estate of Pursuant to the above order, paid to the said the said sum of & to be charged to the debit of my account as Accountant in Bank- ruptcy. Accountant. To the Cashiers of the Bank of England. 73 Nos. 6 and 6 a. Order for Purchase of Exchequer Bills. IN THE COURT OF BANKRUPTCY. Basinghall-street, London, day of 18 Before Mr. Commissioner In the matter of I certify that IT appearing to me, by the annexed certificate, by my books the sum of £ that the sum of £ stands stands to the credit of ^ ., ,.. r.ii. i...tji r the estate in the boots t° *« credit of the above estate. I order the sum of of the Accountant in £ ^ ^g j^^^ ^^^ j^ ^jjg Bankruptcy. purchase of Exchequer-bills, and that the Exchequer- Official Assignee. biUs when purchased be deposited in the Bank of England to the credit of the accountant in bank- ruptcy - provided that no sum be paid for such purchase until the Exchequer-bills be deposited in the Bank of England. Commissioner. Reg. Estate of Pursuant to the above order pay to the sum of £ on his causing £ Exchequer-bills so purchased to be deposited in the bank to the credit of my account as Accountant in Bankruptcy. Accountant. To the Cashiers of the Bank of England. 74 Nos. 7 and 7 a. Order for Sale of Exchequer Bills. IN THE COURT OF BANKRUPTCY. Basinghall- street, London, day of 18 Before Mr. Commissioner In the matter of I certify that by It appearing to me, by the annexed certificate, mLtionedExchTquer'- that the foUowing Exchequer-biUs stand to the credit bills stand to the credit of the above estate, viz. of the above estate, in the books of the I order that Accountant in Bank- ^^ ^^^^ Exchequer-bills be forthwith sold, and for that purpose that such Exchequer-bills be delivered out to one of the cashiers of the bank, who is to receive the money arising by such sale, and pay the same into the Bank of England to the credit of the Accountant in Bankruptcy; provided that such Exchequer-bills be not delivered by the cashier of the bank until the proceeds of the sale be paid into the bank as aforesaid. Commissioner. Reg. Estate of Pursuant to the above order, deliver out of the Bank of England to one of the cashiers of the bank, the following Exchequer- bills, viz. for the purpose of being sold : provided that such Exchequer-bills be not delivered by the cashier of the bank until the proceeds of the sale be paid into the bank as aforesaid. Accountant. To the Cashiers of the Bank of England. 75 Nos. 8 and 8 a. Order for Sale of Stock. IN THE COURT OF BANKRUPTCY. Basinghall-Btreet, London, day of 18 Before Mr. Commissioner In the matter of I certify that It appearing to me, by the annexed certificate, by my books the sum of £ that the sum of £ stock stands to the credit of the above stands to the credit of the above estate, I therefore estate in the hoaika of the Accoantant in order the said sum of £ Bankruptcy. to be forthwith sold ; provided that such stock be not Official Assignee. transferred by the Accountant in Bankruptcy until the proceeds of the sale be paid into the Bank of England to the credit of the said accountant. Commissioner. Reg. To the Cashiers of the Bank of England. 76 No. 9. Notice by Official Assignee to Creditor when Dividend is payable. District day of 18 Estate of Sir, I HAVE to inform you that you may, upon application at my office on any or after the day of between the hours of receive a warrant for the dividend due to you in the above estate. If you cannot personally attend, the warrant will be delivered to your order upon your filling up and signing the subjoined letter. The bills and securities (if any) exhibited at the time of the proof of your debt, must be produced to me before the warrant for the dividend can be received. I am. Sir, Your obedient Servant, Official Assignee. Residence. To day -of Estate of Sir, Please deliver to payable to me under the above estate. To Official Assignee. 18 the dividend warrant Creditor. 77 Nos. 10 and 10 a. List of Proofs of Debt and Claims for Dividend. — No. '2. FoEMs OP List. IN THE COURT OF BANKRUPTCY. Basinghall- street, London, 18 Bankrupt. rthe with In the matter of A LIST OF DEBTS proved and claimed under the the dividend at the rate of in the pound, this day declared thereon by Mr. Commissioner No. Creditors. To be placed alplia- betically, and the Names of all the Parties to the Proof to be carefully set forth. Sum proved. The Claims to be set forth in the same Manner at the End of the whole of the Proofs. Dividend. 78 ■ 0) n ■5 .S ^ !>» s •§ ■g c: «j CI cq .3 tm -g.s 0.sO Ml f ^1 1 § 1=2 t3 tn 1 K •5 i 1— t Pi H CO ►il aj J III Oi .b = i-H s 2 (U -a at o CD ji 0) iS ^0 ^ rt ij ri < 1 11 "§. ^ ^ 1 U >< » ^ ^^ ■65 Pi 0) a to 'i O II ■a S ■3 - z Oi < -a lU a-g m O t ■±3 o -♦J CO .d 1! S R s ■4J S 1 o o a S H 22 !3 \ i 2 < ^ 1 1 •g CO g i Sum. 1 i i* u I P a . 1° •a Sums proved or claimed. Claims to be set forth in the same Manner after the whole of the Proofs. Residence and Description. Creditors. To be placed alphabeti- cally, and the Names of all the Parties to the Proof to be caj-efully set forth. d 79 Margin of Book. Number of Warrant. Estate dividend of in the £ Creditor A.B. Rec'' Warrant day of Creditor. No. 12. London Dividend Warrant. — No. London day of Estate of Bankrupt. (Under fiat or commission, or petition for adjudica- tion of bankruptcy, dated ). dividend of in the £ declared day of 18 A. B. is entitled to be paid the sum of £ Official Assignee. To the Accountant in Bankruptcy. Order for Payment. Let this be paid to A.B. or bearer from my account as Accountant in Bankruptcy. Accountant. To the Cashiers of the Bank of England. N.B.^T^is, upon being endorsed hy the payee, will he paid any day between the hours of eleven and three, at the office of the Accountant in Bankruptcy, at the Court of Bankruptcy, Basinghall-street. Observe rules at the hack as to endorsement. 80 No. 12 — continued. Rules as to Endorsement of Warrant. That the endorsement by an executor or administrator of any creditor be sufficient. That if any other person than the creditor, or person duly authorized by the creditor, claim to receive the dividend, the person so claiming the same must obtain, an order for payment thereof upon the warrant by a commissioner under his hand ; and if any dividend warrant be above twelve months' date, a like order for payment thereof by a commissioner shall be required : Provided always, that in no case shall any such dividend be paid to an official assignee, unless such official assignee be the payee, or the executor or administrator of the payee, or the assignee of any bankrupt payee. 81 Margin of Book. Number of Warrant. Estate of dividend of in the £ Creditor ReC* Warrant day of Creditor, day of No. 13. Country Dividend Warrant.^-Ho. district day of 18 Estate of bankrupt. (Under fiat or commission, or petition for adjudica- tion of bankruptcy, dated ). dividend of in the £ day of 18 A.B. is entitled to be paid the sum of A Official Assignee. To the Accountant in Bankruptcy. [oountat'sl declared otamp. Let this be paid to A.B. or Order for Payment. ■{ bearer from my account as Accountant in Bankruptcy. Accountant. £ To the Cashiers of the Bank of England. N.B, — If the sum to he paid on the above warrant he under the sum of ten pounds, the same may he received at any hranch of the Bank of England without the signature of the accountant, if presented within one calendar month of the date of the warrant. This, upon heing endorsed by the payee, will be paid any day between the hours of eleven and three, at the office of the Accountant in Bankruptcy, at the Court of Bankruptcy, Bttsinghall- street, London, or at any hranch of the Bank of England. Observe rules at the hack as to endorsement. 82 No. 13 — continued. Rules as to Endorsement of Warrant. That the endorsement by an executor or administrator of any creditor be sufficient. That if any other person than the creditor, or person duly authorized by the creditor, claim to receive the dividend, the person so claiming the same must obtain an order for payment thereof, upon the warrant by a commissioner under his hand ; and if any dividend warrant be above twelve months' date, a like Order for payment thereof by a commissioner shall be required : Provided always, that in no case shall any such dividend be paid to an official assignee unless such official assignee he the payee, or the administrator or executor of the payee, or the assignee of any bankrupt payee. 83 Nos. 14 and 14 a. Order of Transfer to Dividend. IN THE COURT OF BANKRUPTCY. BasinghaU-street, London, day 18 Before Mr. Commissioner In the matter of Bt the annexed certificate, it appears that the sum of£ stands to the credit of the above estate ; and by an order made in this bankruptcy on the day I certify that by of a dividend amounting to £ my books the sum of £ was ordered to be paid to the creditors : I therefore stands to the credit of the above estate in the order the sum of £ books of the Account- ant in Bankraptcy. to be carried to the "Dividend Account" of the above Official Assignee. ^^^^^^ Commissioner. Reg. Carried over day of Ent« Q 2 84 Nos. 15 and 15 a. Proof reduced. IN THE COURT OF BANKRUPTCY. day of 18 Before Mr. Commissioner In the matter of I HAVE altered the proof of from £ to £ and hereby direct a warrant to be drawn for the dividend of in the pound, corresponding with such alteration, and amounting to the sum of £ and I further direct a new warrant to be made out for the balance £ to be carried back to the original account of the above estate, in the books of the Accountant in Bankruptcy. £ To be signed. £ To be carried to the " Original Account.'' Dividend on original proof. Commissioner. Carried back day of Entd N.B. — Old warrant to be produced to Accountant in Bankruptcy, and can- celled hy him, before new warrant be stamped and signed by Mm. 85 Nos. 16 and 16 a. Proof expunged. day of 18 IN THE COURT OF BANKRUPTCY. Before Mr. Commissioner In the matter of I HAVE expunged the proof of and I order that a new warrant be made out for the dividend thereon, amounting to £ to be carried back to the original account of the above estate, in the books of the Accoimtant in Bankruptcy. Commissioner. Carried back day of Entd N.B. — Old warrant to be produced to Accountant in Bankruptcy to be cancelled by Mm. Nos. 17 and 17 a. Claim established. IN THE COURT OF BANKRUPTCY. day of Before Mr. Commissioner In the matter of 18 for the dividend of amounting to the sum of £ £ having established his claim of I hereby direct a warrant to be drawn in the pound thereon Commissioner. Signed day of EnfJ 87 Nos. 18 and 18 a. Claim in part established. IN THE COURT OF BANKRUPTCY. day of 18 Before Mr. Commissioner having in part established his claim of £ to the extent of £ I hereby direct a warrant to be drawn for £ being the dividend on the sum of £ And I further direct a warrant for the residue of the dividend reserved on the said claim of £ amounting to £ to be drawn, and the sum carried to the original account of the above estate in the books of the Accountant in Bankruptcy. £ To be signed. £ To be carried to " Original Account." Originally reserved, being the dividend at the rate of in the pound on £ Commissioner. Carried back day of Ent" Nos. 19 and 19 a. Claim expunged. IN THE COURT OF BANKRUPTCY. day of 18 Before Mr. Commissioner In the matter of I HAVE expunged the claim of for £ and hereby direct a warrant to be drawn for the dividend of in the pound thereon, amounting to the sum of £ to be carried back to the original account of the above estate in the books of the Accountant in Bankruptcy. Commissioner. £ Carried back day of Ent^ 89 No. 20. Form of Payment into Bank by Official Assignee to the Chief Registrar's Account. Per-centage Fee under Bankrupts' Estates, 12th & 13th Victoria, cap, 106. day of 18 I DO HEKEBY CERTIFY, that Mr. official assignee of the estate of bankrupt, has this day paid into the Bank of England the sum of £ to be placed to the credit of Esq., as the Accountant in Bankruptcy, and to the credit of " The Chief Registrar's Account." For the Governor and Company of the Bane of England. Cashier. Ent* N.B. — This certificate to be sent or transmitted forthwith to the Accountant in Bankruptcy upon payment being made into bank. 90 No. 21. First Letter to Debtors for Sums under £500. No. Estate of (Residence and Date.) Sir, By the books and statements of the above bankrupt you appear to be indebted to this estate in the sum of £ which, if admitted, I request may be paid at my office on or before the If you dispute this demand, or any part of it, an early answer stating the fact, and the grounds of your objection, may save further trouble. I remain, Sir, Your obedient Servant, Official Assignee. Office Houks — Nine till Four. Bring or send this letter on calling, and in any written communications please name the estate and the number. 91 No. 22. Another Form for Debtors, for Sums under £500, intended for those residing out of London. No. Estate of (Residence and Date.) Sir. By the books and statements of the above bankrupt, you appear to be indebted to this estate in the sum of £ ■which I request may be paid to me at my office, on or before the If the claim is incorrect, or any objection intended to the payment, I request the favour of being immediately informed of the grounds thereof. I remain. Sir, Your obedient Servant, Official Assignee. Note. — If this debt be not paid by the above day, interest thereon at the rate of Jive per cent, per annum, will be demanded, pursuant to the 3rd and 4th William IV. cap. 42. It may be desirable for parties in the country to be informed that the postmaster in post-towns will receive sums not exceeding £5, and give orders for them on the Post Office in London, which orders can be remitted to me in payment of debts. Office Hours from Nine to Four. Bring or send this letter if you call or send. 92 No. 23. Second Form of Letter to Debtors, where first Application has not been effectual. Bankrupt Law Consolidation Act, 1849. Estate of (Residence and Date.) Sir, The applications I have made for payment of £ appearing by the bankrupt's books and statements to be due by you to this estate, having failed to produce a settlement, I have now to inform you, that if this sum be not paid on or before the it will be my duty to apply for a summons to bring you before the Court to be examined on oath, and that you wiU be liable to the costs of this proceeding. I am, Sir, Your obedient Servant, Official Assignee. 93 No. 24. Letters to Creditors for Particulars of Demand, 8fC. Estate of Bankrupt. (Residence and Date.) Sir, I KKQUEST you Will immediately favour me with a statement of your account with the above bankrupt ; and the particulars of any bills, notes, deeds, goods, or other securities in your possession. I remain. Sir, Your obedient Servant, Official Assignee. 94 No. 25. Form of Affidavit by Creditor of Loss of Bill of Exchange. In the matter of maketh oath, and saith, that ha made a careful search for the bill of exchange, the particulars whereof are under-written, and which ha been proved under this estate by but that th deponent ha not been able to find the same, and verily believe that the same ha been lost or mislaid ; and th deponent further saith, that ha not nor ha the said or any person or persons to use, to this deponent's knowledge or belief, negotiated the said bill or either of them, nor in any manner parted with or assigned legal or beneficial interest in the said bill of exchange, or any part thereof ; and that deponent the person now legally and beneficially interested in the same, and entitled to receive for own use all dividends in respect thereof, and that all dividends which have been paid or declared or monies received on account of or in respect of said bill or either of them, or from any other security, do not amount to twenty shillings in the pound, and that the dividend now pay- able under the above estate and not yet received, will not make up twenty shiUings in the poimd. Bill above referred to. Date. Drawer. Acceptor. Sum. Sworn before me at this day of 18 Upon the abovenamed signing the annexed letter of indemnity, and giving security to the satisfaction of the official assignee, I direct the dividend to be paid to Commissioner. 95 No. 25 — continued. Estate of Bankrupt. Sir, The undermentioned bill proved by under this estate, having been lost or mislaid, and the following dividend having been declared thereon, but not yet paid ; viz. and -which dividend vsdth all others already received, or which have been declared or become payable on or in respect of the said bill do not amount to 20s. in the pound thereon ; in consideration therefore of your paying to or to order the dividend above mentioned hereby undertake to indemnify you against all claim of any other person to the said dividend, or any part thereof ; and from all loss, damage, and expense which you, or your executors or administrators, may sustain by reason of your making such payment to me ; and if it should hereafter, appear that the said sum of £ or any part thereof, with the dividends already received or declared up to this day, exceed the amount of the bill hereby engage to repay the same to you, or to the assignee or assignees of the above estate with interest at the rate of 5 per cent, per annum from this day. Dated at this Bill above referred to To Mr. Official Assignee to the above estate. 96 No. 26. Monthly Return of Proceedings from the District Court of Bankruptcy from the to the day of 1 85 both days inclusive. Bankrupt. Name Address Trade Date of Commission Fiat or Filing Petition .... Adjudication. Date of If adjourned or annulled, ) insert accordingly . . . . ) Petitioning Creditor. Name Residence Trade Official Assignee. Date of appointment If changed, insert accordingly Solicitor. Name Residence If changed, insert accordingly Creditors' Assignee. Date of appointment If changed, insert accordingly 97 Last Examination. Day appointed for Adjourned to Passed or otherwise Certificate. Date of Class , Refused or suspended For Special Conditions, Appeal, &c., see Remarks. Audit. Date of Amount in hand applicable to dividend Dividend. No. of, or final Date Rate , Sum divided Surplus undivided Remarks and Special Cir- cumstances I ] INDEX TO RULES AND ORDERS, 12 & 13 VICT. CAP. 106, SECT. 8. ACCOUNTS, Petitioning creditor's To be kept by official assignee ,, on audit ,, by registrar .. To be certified to Accountant in Bankruptcy 136, 144 Quarterly, may be inspected by creditors . . Transfer of . . Of joint and separate estates Of property mortgaged or pledged Of trader petitioning for arrange- ment and forms . . To support summons to trader debtor Examinations as to Arrangements by deed ACCOUNTANT IN BANKRUPTCY, Duty of on dividend To certify payments On transfer of Exchequer bills . . Bank of England to certify pay- ments to . . ,, to certify dishonour of bills of exchange . . . ■ J ACT OF BANKRUPTCY, How to be proved . . . . . . 16 . . . . 4 Disputing 14 . . . . 4 ADJUDICATION, Petition to be written on parch- ment . . . . . . ■ - 2 . . . . 1 Signature and attestation of .. 21 .. .. 5 Application for, how made . . 13 . . . . 4 Affidavit in support to be examined with 3 .. .. 1 Search for previous . . . . 4 . . . . 2 Concurrent receipt of . . "1 c n Trader's own to be preferred / H 2 No. of Order. Schedule. Page. 11 155 65, 66, 67 156 .. 3 64 17,18 64,65 136, 144 .. 57,59 156 153 54 55,57 . . 64 63 14 14,15 A, No. 6 to 10 31 to 36 68,69 11,58,67 99 Annexed 18 3,15,18 37,39 149, 155 136 147 .. 62,64 57 61 144 .. .. 59 100 No. of Order. Schedule. Page. ADJUDICATION— conWnaed. Petitioner neglecting to prosecute 6 2 Allotment of in London , . 7 2 ,, in district .. 7 2 ,, question on, how to be determined 10 3 Registrar may ballot, when 8 3 Second . . 6,9 2, 3 Petitioning creditor's debt to be investigated, how 11,16 .. 3,4 Attendance of 12 3 Compositions subsequent to 116 to 118 .. 53 Appointment of official assignee . . 119 to 121 .. 53,54 SPUTING, Notices to be given 14,16 4 Intended bankrupt to be furnished with names of witnesses 15 4 , , with copies of depositions 15 4 Proof of trading, act of bankruptcy, and petitioning creditor's debt . . 16 4 Extension of time for 16 4 ADVERTISEMENT In Gazette, memorandum of Of certificate of conformity Of sale Of dividend AFFIDAVITS, Filing . . Title of In reply or rejoinder, when used . . In support of trader-debtor sum- mons What certainty required in When not filed in time In support of adjudication , , appeal Of sufficiency of official assignees' sureties ... Of trader arranging by deed 45 60 55 148 /23,24,34,\ I 64, 71 / 25, 68, 97 23 68 72 71 3 64 12 16 14 61 /6,7,I0, I 17, 19 7,18,27 6 18 19 19 1 17 83 99 /A, No. 7,\ \^ annexed j 31 ALLOTMENT OF PETITIONS FOR ADJUDICATION, In London . . In country . . Where two or more . . . . 5 Second against same trader . . 9 Of second where former not pro- secuted . . . . . . . . 6 Question on, how to be deter- mined . . . . . . . . 10 Of petitions for arrangement .. 89 AMENDMENTS or ALTERATIONS, When allowed , . , . . . 2, 30 23 37 3 25 1,8 101 8,16 17 17 16 No. of Order. Schedule. APPEAL, Deposit of costs on. . . . . . 29, 62 Notice to Court of . . . . . . 63 Affidavits iu support, — filing . . 64 Against allowance of certificate, withholding . . . . . . 62 APPLICATIONS To court, how made .. .. 17,26,27 .. ,, for adjudication . . .. 13 Deposit of costs on. . . . . . 62 Of proceeds of sale .. .. 57 ^rit J u is • 1 • ri29,137to1 Of funds by official assignee . . < i „„ > . . Of bills of exchange .. .. 141 to 146 .. Misapplication by official assignee 159 Of funds in bank . . . . . . 138 ARRANGEMENTS. Commissioners may act for each"! gg other . . . . . . J Petitions for, how to be presented"! go ,, allotted .. J Copies of to be deKvered to rtgistraf 90 Notices, service of . . . . . . 93 Deposit . . . . . . . . 91 Imprisonment, causes to be certified 92 Accounts furnished to official assignee . . . . . . . . 94 Minutes of sittings.. .. .. 96 Title of affidavits .. .. .. 97 Forms and accounts . . . . 98 Petitioner may attend sittings "1 gg ,, inspect proceedings J Deed 99 Trustee inspector — Accounts to be appended to cer> tificate . . . . . . 99 Annexed ASSIGNEE, Official 119 to 141 .. Appointment of . . . . . . 121 Allowance of, and scale . . . . 122 Not to trade 130 Sureties to be found by . . . . 123"| ,, liabilities of .. .. 124 1 ,, annual declaration as to . . 125 | ' " ,, death of, notice .. .. 126j To •foUow instructions of commis- sioner 127 .. .. 55 Payment into bank, forms . . 129 . . . . 55 Payments to estate . . . . 134 to 137 . . . . 57, 58 „ out of estate ..' .. 138,139 .. .. 58 Bills of exchange, disposal of . . 141 to 146 . . . . 59, 60 „ Exchequer , 147 . . . . 60 To register bankruptcies .. .. 131 .. .. 56 Balance-sheet, to receive copy of . . 59 .. .. 16 Accounts to be kept by . . . . 66, 67, 155 . . .. 17, 18, 64 ,, audit, to be examined by 67 .. .. 18 ,, ,, form of .. .. 66 .. .. 17 5,7 4 16 15 55,58 59,60 65 58 25 25 26 26 26 26 26 27 27 27 to 36 27 39 37 53,66 54 54 55 54 102 ASSIGNEE, Official — continued. Books to be kept by No. of Order. Schedule. Page. ri32, 133,\ ^137, 140/ •• Deposit on petition for arrange- ment to be received by . . • . 91 Monies reclaimed by .. •■ 128,137,159.. under control of . . When chargeable with interest Duty on dividend . . ,, audit Ihities under arrangements, same as in bankruptcy . . Creditohs' Costs of, under order of sale Accounts . . the ATTENDANCE, Petitioning debtor's right as to On trader-debtor summons — By plaintiff By defendant . . ATTESTATION Of petitions ATTORNEY, Enrolment of Service on . . Name to be endorsed on trader- debtor summons. . Duty of, on dividend Neglecting to tax . . To attest petitions . . Changing abode AUDIT. Taxing bills Payments, when to be made Neglecting to tax . . Accounts, forms of ,, examination of . . Assignee's duty at . . Costs Debtor to estate to be examined } 137 159 148 66,67 161 57 66,67 95 78-1 J 79 21 35 to 38 36,37 75 149 65 21 36 65 66 67 66,67 65 67 56, 58 25 ..55,58,65 58 65 61 .. 17,18 66 15 .. 17,18 27 22 10,11 10 22 61 17 6 10 17 17 18 17,18 17 18 B. BALANCE-SHEET, Filing Time BALLOT Of petitions for adjudication BANKRUPT, Filing balance-sheet ,.. \ Time J Trader sought to be made, may have copies of depositions Documents, &c. to be given up (see Official Assignee's Letter) 59 5 to 8, 10 59 15 Schedule of Forms 16 2,3 16 4 67 103 See BANKRUPTCY, Petition for adjudication in. Adjudication. Register of to be kept by official BAR. No. of Order. Schedule. Pugc. Precedence . . 131 .. .. 56 27 BILLS Of costs. See Costs. Of exchange and promissory notes in hands of official assignee to be deposited in Bank of England . . 141, 146, 157 . . When due, how dealt with . . 142 Dishonour, how to be certified \ ,,„ ... j.g ,, notice given J ' ' May be delivered to official assignee 146 Of Exchequer, sale and transfer of 147 s 6 7 BOND, Trader Debtor's, Execution of, notice to be given . . Sureties', notice to be given Not excepted to, where . . Penalty, and form of . . 1 Sum to be secured . . / BOOKS. See Registrar and Official Assignee. Bankrupt's, to be sorted and num- bered by official assignee . . 59, 60, 65 59 .. 59,60 59 74 J60,73: 82 83 88 87 133 23 23 25 25 56 C. CA. SA. See Forms ,. CERTIFICATE Of conformity, advertisements Costs, deposit of . . To be transmitted to chief regis- trar Appeal — Notice to Court to be given Affidavits, filing . . Under petition for arrangement — Of causes of imprisonment Of approval of resolutions Under arrangement by deed — Of Court, of execution ^. Of trustee, inspector, or two cre- ditors . . Of commissioner, of number and value of assenting creditors under composition after adjudication . . Of appointment of assignees 113 Annexed 43 to 52 60 \ 62/ .. 16 61 .. 16 63 64 , . 17 17 92 99 A, No. "4 26 30 99 No. 5 40 99 No. 2 37,38 118 121 .. 53 54 104 No. of Order. Schedule. Page- CHANCELLOR, THE LORO, May direct removal of proceedings 42 . . • • 12 CHIEF REGISTRAR. See Registrar. COMMISSIONERS. Jurisdiction 17 to 22 . . . . 5 to 7 London district- Division of commissioners, &c., among .. -. •• 31,32 .. .. ", " Registrar may act for, wlieu . . 44 . . . . 12 ,, may order bills to be deli- vered to official assignee 147 . • • • 60 To order investment of monies . . < j^g' ^^h > •• •• 58, 60 Signature, attested .. .. 138,147,153.. ..58,60,63 May act for each other . . . . 89 . . • • 25 See Court and Jurisdiction. COMMISSIONS AND FIATS, Transfer of and entry .. .. 31,32 .. .. 8,9 Appointment of official assignee . . 119, 121 . . - . 53, 54 See Adjudication. COMPOSITION, After adjudication 116toll8 .. .. 53 Concurrent petitions . . . . 5 . . . . 2 Commitment . . . . . . 19 . . . . 5 CONVEYANCE, Under order of sale, parties .. 56 .. .. 15 COPIES Of depositions to support adjudi- cation may be furnished to in- tended bankrupt. . . . . . 15 . . . . 4 Of petition for arrangement to be delivered to registrar . . . . 90 . . . . 26 Office, of proceedings, how made. . 47 .. .. 13 ,, charge for. . 46 .. .. 12 Of bills of costs, how made . . 51 . . . . 13 Of balance-sheet . . . . . . 59 . . . . 16 Rules, registrar to supply . . . . 162 . . . . 66 COSTS Of appeal 29,62 .. .. 8,16 Of petitioning creditor . . . . 114, 115 . . . . 52 Of summoning creditor . . . . 80 . . . . 23 Of assignees under order of sale . . 57 . . . . 15 ,, on audit ., .. 65,66 .. .. 17,18 Of certificate of conformity . . 62 . . . . 16 Of office copies of proceedings . . 46 . . . . 12 Taxing 48,52,65,102.. ..13,17,41 Payment of (see Order) .. .. 100 to 113 .. .. 41 to 53 Of neglect by officers . . . . 65 . . . . 17 COUNTIES, Division of in London district .. 32 Annexed 8,9 105 No. of Order. Schedule. Page. COURT, Applications to, how to be made . . 17, 27, 28 5,6 Petitions to, how to be signed and attested . . 21 6 Amending writs . . 113 43 Leave of, when to be obtained . . 2, 6, 23, 30 .. 1,2,7,8 Division of . . 32 Annexed 9 Ordering dividend. . 150, 152 . . 62, 63 May permit official assignee to 1 retain funds . . . . / 159 65 CREDITOR, May inspect accounts 156 65 Petitioning, debt how investigated 11, 16 3,4 Neglecting to prosecute . . Second petition by . . / 6 2 Mortgage, proof of, for deficiency 57 15 Summoning, not appearing 78 22 ,, affidavit of .. 72 19 „ not complying with rules 80 23 Must produce securities on pay- 1 ment of dividend . . [> 150 62 Wben otherwise . . . . J D. DEBTOR, Petition for adjudication by. See Adjudication. ,, for arrangement. See Arrangement. To estate to be examined at audit 67 18 List of, to be kept by official assignee . . 140 58 Payments by 134 to 136 57 Trader, summoned. See Summons. DEBTS, Proof of, when to be made 531 ,, when jointly 54 1 14 „ against joint and separate f estate . . 54j „ by mortgagee for deficiency 57 15 Petitioning creditor's, how investi- gated 11,16 3,4 Disputing . . 14,16 4 DEEDS, Production of 58, 150 .. 15,62 DEFINITION Of terms . . 1 1 DEMAND, Particulars of, to support trader- debtor summons . . . . 68 "1 - „ How directed .. .. .. 69 J Fresh, when required .. .. 71 .. .. 19 106 No. of Order. DEPOSIT Of costs on appeal. . . . . . 29, 62 On petition for arrangement . . 91 DEPOSITIONS. Copies may be furnished to in- tended bankrupt. . . . . . 15 DISPUTING ADJUDICATION. See Adjudication. DISTRICT COURT, AUptment of petitions in . . . . 7 DIVIDEND, Advertisement . . . . . . 148 Duty of official assignee . . . . 149, 150, 154 ,, accountant .. .. 144,149,154 ,, solicitor .. .. .. 149 How paid . . . . . . . . 151 "1 When paid to other than creditor who > proved .. .. .. .. 152 J When no sureties . . . . . . 150 When uncalled for . . .. .. 153 Unpaid, how cancelled . . . . 154 Securities to be produced , . . . 150 Not to be disturbed by proof of mortgagee .. .. .. 57 Schedule. Page. 8,16 26 Forms 9 to 13 61 ..61,62,64 . . 59, 62, 64 62 163,76,81 63 64 64 62 15 E. ELEGIT. See Writs. Forms, No 106,113 Annexed, 7|^j^ gg Execution for costs . . . . 100"! ,- How to be issued 103/ "• " Praecipes 104, 105~| Forms 106 I .„ Teste and return 107 f •" "■ Endorsement of amount .. .. 108 J Satisfaction .. .. .. Ill, 112 .. .. 43 ERASURES, Not to be vrithout leave .. .. 2,41 .. .. 1,12 ESTATE, Joint and separate, proof . . \ , , ,, accounts J .... „ costs .. .. 115 .. .. 52 Debtor to, to be examined at audit 67,140 .. .. 18,58 Payments to 134 to 138 . . . . 57, 58 EXAMINATION, LAST, Balance-sheet, filing .. I Copies of, to be delivered to offi- l 59 . . . . 16 cial assignee . , . . J Of debtor to estate. . . . . , 67, 140 . . . . 18 58 Of parties to mortgagees' accounts 58 .. .. ' 15 107 No. of Order. Schedule. Page. EXCHEGIUER BILLS, Investment Sale )■ 147 .. .. 60 Transfer } FI. FA 106,113 Annexed, No. !•{ F. 42 to 46 FIATS. See Adjudication and Commissions. FORMS Ofpayment "l jgo _ __ gS Printed . . . . . . . . J TobefoUowed 158 .. .. 65 Of trader debtor's bond , . . . 87 . . . . 25 Of writs 106,113 Annexed Z'*^' ^^ '° Under petition for arrangement — Order of protection to petitioning ^„» oa trader A, Nos. 1,2,51^'^^"' „ release from custody . . . . A, No. 3 28 Certificate of approval A, No. 4 30 Accounts to be filed by petitioner .. A, Nos. 6tolO-j og Under arrangement by deed . . 99 Accompanying 37 Certificate by trustee or inspector . . A, No. 1 37 ,, by two creditors .. .. .. No. 2 38 Account of inspector . . "1 „ oftrustee .. f. .. .. No. 3 39 „ two creditors . . J Affidavit of trader No. 4 40 Certificate of execution . . . . . . . . No. 5 40 List of, contained in Schedule of Forms — Of letter to bankrupt forthwith, after appointment of official as- signee No. 1 67 Direction from official assignee for payment of sums exceeding ^500 in amount due to a bank^ mpt's estate into the bank . . . . . . No. 2 68 Certificate of payment into bank by other than official assignee . . . . No. 3 70 Certificate of payment into bank by official assignee . . . . . . . . No. 4 71 Order for payment of money . . . . . . No. 5 72 Order for purchase of Exchequer bills No. 6 73 Order for sale of Exchequer bills . . . . No. 7 74 Order for sale of stock . . . . . . . . No. 8 75 Notice by official assignee to cre- ditors when dividend is payable .. .. No. 9 76 List of proofs of debts and! fNos. lO&lOal »- -„ claims for dividend .. J " \ &ll&lla f''''° London dividend warrant. Rules as to endorsement of warrant . . . . No. 12 79, 80 108 FORMS— List of, continued. Cpunty dividend warrant. Rules as to endorsement of warrant Order of transfer to dividend Proof reduced . . Proof expunged . . Claim established Claim in part established Claim expunged . . Of payment into bank by official assignee to the chief registrar's account First letter to debtors under ;f 500 Another, for debtors for sums under jSSOO, intended for those residing out of London Second, of letter to debtors, where first application has not been effectual . . Letters to creditors for particulars of demand, &c. Of affidavit by creditor of loss of bill of exchange . G. GAZETTE, Copy of, not to be on proceedings "j Registrar's memorandum of, to be I on proceedings . . . . . . r Copy of, to be kept by chief registrar J Sale to be advertised in . . No. of Order. Schedule. Page. . . No. 13 81,82 Nos. 14&14a 83 Nos. 15&15a 84 Nos. 16&16a 85 Nos. 17&17ffi 86 Nos. 18 & 18 a 87 Nos. 19 & 19 a 88 . . No. 20 89 .. No. 21 90 No. 22 45 55 91 No. 23 92 No. 24 93 No. 25 94, 95 12 14 I. IMPRISONMENT. On application for release by trader petitioning for arrange- ment, causes of to be certified . . INSPECTOR, Under arrangement by deed, cer- tificate of Accounts to be kept by . . INTERLINEATIONS 2,41 92 99 3 26 Accompanying 37 39 1,12 M. MASTER, To tax bills of cost Office of Business of, to be transacted in person MEETINGS UNDER COMPOSITION, First to be taken by solicitor to assignees . . Second to be taken before commis- sioner Right to attend . . . . ., 48-1 49 ^. 50j iiei 117/ 95 13 53 27 •109 No. of Order. Schedule. MESSENGER, To advertise certificate Neglecting to tax his bill previous to audit . . To serve notices Costs 60 65 93 65 MONIES. of 138\ 139/ 129,157 Order for payment. . ,, to be in triplicate How to be paid to Bank England Proceeds of sale of mortgaged pro perty 57 Retained by official assignee . . 128, 137, 159 Under control of official assignee, how to be dealt with . . . . 137 Investment of . . . . . . 147, 157 Transfer of 153 Payment of. To estate 134 to 136, 157 By official assignee 137, 139, 140 MORTGAGE. Accounts and sale, how to be taken 55, 58 Conveyance under order of sale, when necessary . . Application of proceeds of sale of. . Proof by mortgage creditor for deficiency. . Parties to be examined MORTGAGEE PROVING, Not to disturb dividend .. .. 57 Page. 16 17 26 17 58 55,65 15 55,58,65 58 60,65 63 57, 65 58,59 .. 14,15 15 15 Supported by affidavit 17 5 Notice of, how to be served 20 6 How to be made . . 17,26,27 .. 5,7 Affidavits by respondent, when to be filed .. 23 6,7 Order of making . . 26, 27 7 Note of, to be delivered to registrar 22 6 N. NAME Of party summoned, how set forth NEGLECTING To prosecute adjudication . . To file affidavits in time . . To tax costs 68,69 6 71 65 NOTICE Of motion, service. . .. 17,20,36,37,38 To dispute adjudication .. -. 14 To be endorsed on trader-debtor summons. . . . - . - - 68, 74 17,18 2 19 17 5,6,10,11 4 . . 18,19 110 i^OTlCE— continued. Of allowance of certificate of con- formity . . . . . . Of appeal to be given to Court . . Substituted service . . Service of, under arrangement Of sale under order of Court To be served on registrar . . Of trader debtor's bond . . Sureties, . . . . . . . . Official assignee's NOTES. See Bills of Exchange. No. of Order. Schedule. Page. 60 16 63 17 17 to 19, 38, 93 . 5 11 26 93 26 55 14 63, 85 17 24 82 23 83 23 125, 126 . 54, 55 OFFICE Of registrar. Of Master . O. See Registrar. 49 13 OFFICIAL ASSIGNEE. See Assignee. ORDER. See Forms. Recitals in . . To show cause, service of . . Disobedience of Of making motions. . For payment of costs For execution under Taxing costs Execution to be issued by chief registrar . . Praicipes to be filed with chief registrar .. .. .. ., 104 Forms of writs Teste and return 107, 110 Endorsement . . . , Satisfaction . . Amendment of writs For payment of monies, how to be signed . . Parties affected by, showing cause against . . OVERPLUS, Joint and separate estate . . P. PARCHMENT, Petition for adjudication to be writ- ten on .. .. .. .. 2 PARTIES To conveyance under order of sale 56, 58 Examination of 58,67 Description of, in trader-debtor summons . . . . .... 73 Affected by order . . . . . . ] 7 22 18 to 20 . . 19 27,29 100 to 113 Annexed 101 102 6 5,6 5 7 41 to 51 41 41 103 41 )4, 105, 113 Annexed 42, 48 106 Annexed 107,110 .. 108 111,112 .. 113 f 42, 44 \ to 51 42,43 42 43 43 139 17 54 58 14 15 15, 18 19 Ill No. of Order. Schedule. PARTICULARS OF DEMAND .. 68,69 PARTNERS, Signatures of .. .. .. 21,68 PAYMENT, Notice requiring, trader - debtor summons .. 68,69 Of dividend warrant . . . . 149 to 152 . . Of costs 100 to 113 Annexed Of monies due to estate . . .. i J^*' J^^'j . . Out of bank 138 Order for 139 PENALTY To trader-debtor's bond .. .. 87 PETITIONS TO COURT, How filed 34, 89 How to be signed and attested . . 21 How to be entered . . . . . . 22 When to be heard . . . . . . 26 Affidavits on, how to be filed .. 23,34 ,, in reply, not to be used without leave . . .. 23 ,, to be endorsed by regis- trar 24 ,, how to be intituled .. 25 PETITIONS FOR ARRANGEMENT. See Arrangement. PETITION For adjudication (see Adjudication) 2 to 13 PETITION OF APPEAL, Affidavits in support of, how to be filed 64 Costsof 29,62 Notice .. 63 PETITIONER Neglecting to prosecute . . . - 6 PETITIONING CREDITORS, Personal attendance of, at adjudi- cation . . . . . . ■ • 12 Debt, how to be investigated "l^ 11 16 .. „ how to be proved . . J ' Costsof 114,115 .. PLEDGE. See Mortgage. PRECIPES, How to be filed 1041 Annexed Book of, how kept 105 J Returns 110 Page. 18 6, 18 18 62,63 41 to 51 57,58 58 58 25 10,25 6 6 7 6, 10 lto4 17 ,16 17 3 3,4 52 42,43 43 112 PRECEDENCE Of bar PREVIOUS COMMISSIONS, FIATS, or ADJUDICATIONS Against the same person, to be searched for PRISONER Petitioning for arrangement, to cer- tify causes of detention . . Account to be furnished to official No. of Order. 27 PROCEEDINGS In court, how to be written To be of record in court . . Not to be removed except by leave Minutes of, to be drawn by registrar Office copies of, charge for ,, how to be made . . To contain balance-sheet . . PRODUCTION OF DEEDS On sale of mortgaged property By bankrupt PROOF OF DEBTS, When to be made . , Against joint and separate estate . . By mortgage creditor for deficiency PROPERTY. Accounts to be furnished under petition for arrangement PROTECTION Under arrangement, how to be endorsed. See Arrangement. PURCHASER, Title to, how to be made . . Schedule. Page. 7 92 2G 94 A, No. 6 |26, 31 to 36 58 Schedule of Forms 53 54 57 } 12 12 13 16 15 67 14 15 58 A, No. 6 26 to 36 15 REGISTRAR, Chief, To file documents, &c. Toexamine petitions for adjudication and affidavits To search for previous commissions, &c. against the same person Certificate of conformity to be trans- mitted to To receive deposit on appeal against certificate To receive notice of appeal against certificate To issue execution, when . . 34 10 3 1 4 2 61 16 62 16 63 103 17 41 113 No. of Order. Schedule. Page. REGISTRAR, Chief— continued. Praecipes to be filed with . . . . 104 . . . . 42 Praecipe book to be kept by . . 105 42 Returns of writs to be made to . . 110 . . 43 To enrol attorneys 35,36 .. .. 10 Of Court, To attend court and draw minutes 43, 96 . . 12, 27 Allotment of petition for adjudica- tion by 7 .. .. 3 In absence of commissioner . . 8 . . . . 3 Quarterly accounts. . . . . . 156 . . 64 When to act for commissioner . . 44 . . . . 12 To attest signature of commis- sioner, when .. .. .. 138,147,153 .. ..58,61,63 To make and file memorandum of Gazette 45 .. .. 12 To file and endorse affidavits . . 24 . . . . 7 To tax costs on audit .. .. 65 .. .. 17 To supply copies of rules . . .. 162 .. .. 66 Notices to be served on .. ., 63,85 .. .. 17,24 I^f District, To examine petitions for adjudica- tion, and affidavits . . . ■ 3 . . . . 1 To search for previous adjudication, &c 4 .. .. 2 Senior, To keep same books as chief in London .. .. .. .. 37 .. H To transmit minutes to chief .. 40 .. 11 To tax costs 52 .. .. 13 RELEASE Of petitioning trader from custody "1 j^ -^^^ 3 28 See Form of. / RETURNS Ofwrits 110 .. .. 43 RULES AND ORDERS, When to take effect . . . . 163 . . . . 66 Copies of to be supplied by registrar 162 .. 66 Disobedience of . . . . . • 80 . . . . 23 As to official assignees under arrangements 161 .. .. 66 55 .. .. 14 SALE Of mortgaged property, directions for taMng accounts Application of proceeds .. •• VY Conveyance, where necessary . . 56 i- Costs of , how to be paid .... 5' J Advertisement of ^^ ■■ ■• ,Z Title, how made . . I 58 .. .. 15 114 No. of Order. Schedule. Page. SATISFACTION 111,112 .. .. 43 SEARCH To he made for previous fiat or petition . . . . . . . . 4 . . . . 2 SECOND PETITION BY CREDITOR Neglecting to prosecute a former . . 6 . . . . 2 To be presented before the commis- sioner to whom first was balloted 9 . . . . 3 SECURITIES To be produced on payment dividend . . When otherwise . . of-j I 150 62 SERVICE Of notices by messenger . . Of order to show cause Of notice of motion Of summons to trader debtor 93 18,20 20 76,77 .. 26 5,6 5 22 SHOWING CAUSE, Service of order to . . . . . . 18 1 Notice .. .. .. .. 17 to 20/ •■ Against adjudication. See Adjudication, disputing. 5,6 SIGNATURE To petitions 21 6 SITTINGS, Right to attend 95 27 SOLICITOR. See Attorney. SUMMONING CREDITOR Not appearing . . . . . . 73 _ _ _ 22 SUMMONS To debtor to estate .... e? jg To trader debtor 68 to 86 '.'. " ig 25 Particulars of demand and notice 68"! ' How to be signed . . . . 68 I . . 1 g How to be directed ' Form of account AfSdavit not filed in time What certainty required in .. 12/ .. 19 Parties, how to be described in. . "" Endorsement of notice of, effect on Attorney suing . , Service of . , . . , . , « , , , Plaintiff failing to appear . . 78 f ' • ■ • 22 Defendant, when to be discharged 115 r.TT>Timi..Tr. .. . No. Of Order. Schedule SUMMONS — continued. Discharge endorsed on summons . . 79, 80 Enlargement of time . . . , 81 "1 Defendant entering into bond, I notice , . . . . . . . 81 f ' ' Sureties 83, 85J Non-compliance with rules 79 SURETIES TO TRADER DEBTOR'S BOND, Notice of, to be accompanied by! affidavit of sufficiency . . j. 83 , , form of . . . . J To justify in what amount . . 84"! How to be excepted to . . . . 85/ To* official assignee 123 to 126 . . SURPLUS Of joint or separate estate .. 54 T. TAXATION. See Costs. TERMS. Definition of . . . . . . 1 TRADER DEBTOR. See Summons to. Petitioning for adjudication . . 5 Arrangement . . . . . . 89 to 98 Compounding . . . . . . 99 Annexed, 1 TRADING, How to be proved . . . . . . 11,16 Disputed .. .. .. .. 14 Official assignee not to trade . . 122 TRUSTEE 99 Annexed, 1 V. VENDITIONI EXPONAS Writ of 109,113 Annexed W. WARRANT. Dividend warrant. See Dividend. To commit 19 WITNESS ON ADJUDICATION, Attendance of . . . . - ■ 12 Names of to be furnished to intended bankrupt . . . . • . • . 1^ To account and sale of mortgaged property . . . . . . • ■ 58 Page. 22, 23 23,24 22 23 24 54 14 2 25 to 27 37 3,4 4 54 37 43 3 4 15 116 ^■5 No of Order. Schedule. Page. i3. Praecipes ".. . . 104, 105 42 Forms .. 106,113 Annexed 42 to 51 Teste and Beturn . . 107") Endorsement of amount . . 108 ^ 42 Venditioni exponas 109j Returns 1101 Satisfaction . . ml 43 Amendment 113J See Forms. PRINTED Br COX (BROTHERS) AND WYMAN, 74-5, GRBAT QUEEN-.sTRBBT. mm ><